Finance Minister on Tax Credits, Gold Smuggling, and Exchange Rates

The press conference addressed the approval of an introduction policy for refundable tax credits at the Social Security National Council, a system intended to provide finely calibrated benefits linked to income on a full scale. It was explained that, although wording adjustments remained, the final decision had been entrusted to the chair, placing the parent council, including the government, in a position to receive the report.

The minister viewed this approval as important progress toward giving concrete form to a policy that the Prime Minister considers the central objective, and expressed gratitude for the discussions led by Chair Onodera and the participating parties. The press conference presented three main issues: progress on the benefit system, action against tax-related unfairness caused by gold smuggling, and cautious remarks on exchange rates.

Refundable tax credits represent a policy toward the full-scale introduction of a system that adjusts benefits according to income and will affect the future administration of social security and taxation. Because wording adjustments remain, the actual system details are still under consideration.

Stronger action against gold smuggling will affect the recovery of valuable tax revenue that is being lost and the correction of perceived unfairness. Strengthened screening at import and export may make transactions take longer than before, but the minister asked for understanding that this burden is necessary to correct a social harm.

Regarding exchange rates, the minister maintained a stance of not assessing a specific level while indicating an intention to take decisive measures whenever necessary.

Regarding gold smuggling, the question pointed out that differences in consumption tax with overseas markets and the consumption-tax refund system were factors prompting smuggling. In response, the minister explained a cycle in which gold on which consumption tax had not been paid at import was sold and resold to domestic refiners and processors at prices including consumption tax, and ultimately received a refund when exported. The minister said that organized smuggling schemes may make domestic distribution routes difficult to trace by melting smuggled goods, changing their form, and repeatedly reselling them, describing the situation as still serious.

Customs is strengthening screening and inspections by thoroughly inspecting imports, clarifying distribution routes at export, and requesting detailed transaction documents to confirm that goods are not smuggled imports. The minister said that customs, the Tariff Bureau, and other relevant departments were responding.

Regarding measures against gold smuggling, the minister indicated a policy of working more intensively and closely with relevant institutions, while avoiding prejudging any specific legal amendments at this stage and taking into account views that some form of institutional response is necessary.

Regarding exchange rates, the question stated that the yen-dollar exchange rate was still moving in the 162-yen range. The minister replied that comments on the specific exchange-rate level would be withheld and then stated that decisive measures would be taken whenever necessary.