Govt seeks to double labor productivity to 2% in 3 years

Jiji PressTOKYO (Jiji Press) — Japan’s government will aim to double the country’s labor productivity to 2 percent in the three years through 2020 from 0.9 percent, the average in the five years through 2015, informed sources told Jiji Press on Monday.

The government is set to include the target in a package of policy measures that it plans to adopt on Friday to help realize a “productivity revolution,” an initiative designed to ensure sustainable wage growth and overcome deflation, the sources said.

The policy package is also expected to call for increasing corporate capital spending by 10 percent in fiscal 2020 from the fiscal 2016 level and achieving wage growth of at least 3 percent every year during the three-year intensive reform period through 2020.

The government is set to pledge that it will utilize all policy measures to improve productivity, including the greater use of big data and artificial intelligence technology.

Also in the package, the government plans to reduce corporate tax burdens to internationally competitive levels for companies actively boosting their wages and capital expenditures.

In addition, corporate tax burdens on companies making efforts to increase wages and improve productivity by utilizing AI and internet of things-related technologies will be reduced to levels that can help them survive international competition, the sources said.

Corporate tax incentives will likely be given to small companies increasing wages. The government is also slated to offer fixed asset tax cuts and subsidies to small companies.

The government will also set the next 10 years as an intensive period for promoting smooth business succession among small companies, by expanding the scope of an inheritance tax moratorium.

It will also encourage companies to use their cash and deposits for capital expenditures and investment in human resource development by reviewing corporate governance guidelines before next year’s shareholder season peaks in June, the sources said.Speech

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