The market reacted immediately to the birth of new President Shigeru Ishiba… Behind the scenes, there are concerns that the Ministry of Finance is planning to raise the consumption tax.

On September 27, the LDP presidential election was held, and Ishiba was elected as the new LDP president, defeating Takaichi in a decisive vote. This was the first victory in five attempts to win the presidential election, and he is scheduled to be elected prime minister at the extraordinary Diet session on October 1.

The outcome of the election also had a major impact on the economy.

The Nikkei Stock Average rose as much as 2.32% on Friday, October 27, as the election was won by Mr. Takaichi, who is pro-fiscal policy and called the Bank of Japan’s interest rate hike “stupid. However, when the austerityist Ishiba won after 3:00 p.m., the market reacted immediately, with Nikkei 225 futures falling 4% in a matter of seconds.

Why the “tax hike” policy?

Mr. Ishiba mentioned that he would review the taxation of financial income. Currently, when you sell stocks, you are taxed at a flat rate of 20% regardless of your income, but Mr. Ishiba wants to increase this rate. In essence, even rich people who made a lot of money from stocks and dividends only had to pay 20% tax, which was a small burden. Since the tax is about to be increased, the stock market is likely to cool down and sell off in one fell swoop. In addition, the government is also suggesting partial increases in corporate and income taxes, which is likely to further raise the burden on the public. On the other hand, the attitude of “taking from those who can economically afford it” may be welcomed by the low-income class.

Yoichi Takahashi, a former bureaucrat in the finance ministry, wrote on his YouTube channel on the 24th before the presidential election

If this is Ishiba, the consumption tax will be 15%! The dark days of the Ministry of Finance are back!

The video was released on his You Tube channel. Noda, who served as vice minister of finance during the DPJ’s term in power, was said to have been persuaded by the Ministry of Finance to “set up” two consumption tax hikes. If Noda becomes the leader of the Constitutional Democratic Party of Japan (DPJ) and Ishiba becomes the new president of the DPJ, “the consumption tax will be raised to 15%, and even higher,” he said.

“He has stated categorically that he will aim for a 15% consumption tax, and even higher.

He has stated categorically that “the consumption tax will go up to 15% and even higher.