THIS MONTH AT THE TAX OFFICE (principal items only)
- Companies with a July fiscal year-end final returns for corporate tax & consumption tax due
- Companies with a January fiscal year-end interim returns for corporate tax & consumption tax due
- National tax system renewal September 24, 2026
- Local tax portal (eLTAX) renewal September 24, 2026
- Liquor tax revision, per 350ml beer down ¥9.10 · happoshu (low-malt) up ¥7.26 · chūhai up ¥7.00
A NOTE ON THE SYSTEM CHANGEOVER
As listed above, both the national tax system and the local tax portal, eLTAX, are being enewed on Thursday,September 24. As a result, neither system will be available from Saturday, September 19 through Wednesday,September 23. Please plan any filings or payments around this window.
The Real Reason Rates Keep Rising Isn’t Inflation Anymore
Eight months ago I said interest rates were the thing to watch this year. I was
right for the wrong reason — and the real one is harder homework than any of
us expected.
A hot, busy August has passed and September is here, though the summer heat still feels stubbornly full of energy. My advice, to myself as much as to anyone: don’t rush the transition. Let the body and mind that spent two months enduring the heat ease into autumn at their own pace.
Back in January, I wrote that interest rates were the thing to watch this year. My reasoning then was straightforward: Japan was finally shaking off thirty years of deflation. For three decades, a self-reinforcing loop had held rates pinned to the floor — a weak economy meant prices couldn’t rise, and prices that didn’t rise meant there was no reason for the price of money itself, the interest rate, to rise either. Thirty years is a long time to be stuck inside one sentence of economic logic.
The thing that finally broke that loop was Covid. While the pandemic spread, economies everywhere shut down, and governments answered with enormous fiscal support — for public health, and simply to keep economies breathing. When the spread finally slowed, the world’s economies came unstuck all at once, like water released from behind a dam, and that acceleration carried inflation with it to every country, including one that had spent thirty years insisting inflation couldn’t happen here. Inflation arrived, and rates followed it up.
That was the story eight months ago. It isn’t quite the story now. What’s driving rates higher lately has less to do with inflation and more to do with government borrowing
itself. Japan’s public debt has passed ¥1,000 trillion, a figure large enough to sound
abstract, but Japan is no longer unusual in carrying one. The United States is sitting on
roughly $40 trillion — about ¥6,320 trillion — of its own federal debt. The reasons pile
up everywhere you look: the war between Israel and Iran has pushed up oil and related
resource prices; that war, together with the one in Ukraine, has governments rebuilding
their defense budgets; an aging population worldwide is driving social security and childsupport spending higher across nearly every advanced economy. Layer on top of that
Prime Minister Takaichi’s own program of what she calls “responsible, proactive fiscal
policy” — growth investment, a consumption tax cut, and subsidies for the industries that
cut will hurt — and, in the United States, President Trump’s tax cuts under what he
named the “One Big Beautiful Bill.” Almost nobody, anywhere, is spending much time
these days on the question of where the revenue comes from. Nearly all the debate is
about how to spend the money the state already has, or wants to have.
Follow that logic to its end and the connection to interest rates becomes obvious enough.
When a government needs money and tax revenue doesn’t cover it, it borrows the rest by
selling bonds — and to persuade investors to buy those bonds, in a world already awash
in government debt, it has to offer them a better rate.
Eight months into the year, the environment around interest rates has shifted, and the
list of things worth thinking through has only gotten longer. This isn’t the kind of
assignment you can finish the way you finish summer vacation homework, crammed into
the last few days before it’s due. It’s a harder kind of work, and it isn’t going away in
September.
