The Home Affairs Ministry on Tuesday proposed a dual corporate tax system that would force businesses to pay local taxes, even if they are operating in the red.
The tax proposal, unveiled by Home Affairs Minister Mamoru Nishida at a news conference, features a reduction in the existing prefectural corporate tax and the creation of a new local tax to be levied regardless of whether a company posts a profit.
While the ministry insists the new formula will provide tax relief to the nation's hard-pressed small businesses, the plan is designed to collect taxes even from money-losing businesses on the grounds that they all benefit from public services.