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Taxes front and centre in Japan’s passenger car market outlook

In the years ahead, Shinzo Abe’s plans to raise consumption tax from 8% to 10% will make their presence felt in the Japanese automotive industry. By Anna-Marie Baisden, Head of Autos Research at BMI Research

Japanese passenger car sales will largely be shaped by changes to various tax structures over the coming years, the timing of which will impact market growth. Changes to the country’s sales tax and revisions to incentives on ‘eco-cars’ will also result in certain segments finding themselves particularly affected. All of this means that while we will see a slow recovery in car sales over the next year or two, it is likely to be inconsistent and fragile.

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