Business

Abe adviser urges ‘substantial’ coporate tax cut

TOKYO — Shinzo Abe should cut the corporate tax rate in one stroke to match rivals and help Japan survive a global tax ‘‘war,’’ an adviser to the prime minister says.

‘‘It’ll be much less effective if we don’t substantially cut the levy,’’ Koichi Hamada, 78, a retired Yale University professor who advises Abe on monetary policy, said in an interview Monday in Tokyo. ‘‘By cutting the rate significantly, Japan can attract investment from abroad and keep Japanese companies at home.’’

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Abe said last week he’d aim to lower corporate taxes from next year to under 30 percent over the next few years. Hamada proposes reducing the levy of about 35 percent — the second highest among Group of Seven nations — to a rate close to the 23 percent in Britain and 24 percent in South Korea.

Britain has cut its rate in several steps to 23 percent from 30 percent in 2007, while South Korea’s levy fell from 28 percent in the same period.

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Abe has made company tax cuts a flagship policy for the latest round of his growth strategy. A draft of the plan released Monday shows the government proposes changes to labor regulations, and the creation of a corporate governance code.

Associated Press

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