December 6, 2015 / 5:34 AM / in 2 years

Japan's Amari expects revised third-quarter GDP growth around zero

TOKYO (Reuters) - Economy Minister Akira Amari said on Sunday he expects Japan’s revised gross domestic data to show zero growth in the July-September quarter, on annualized basis, which would be an improvement on the contraction shown by the preliminary data.

Japan's Economics Minister Akira Amari, who retained his post after a cabinet shuffle, arrives at Prime Minister Shinzo Abe's official residence in Tokyo, Japan, October 7, 2015. REUTERS/Yuya Shino

“I think revised (GDP) data will probably be zero and the economy will grow positive thereafter,” Amari told a talk show on public broadcaster NHK.

“Japan is on a steady recovering trend.”

A Reuters poll analysts expect Japan’s third-quarter economic growth data, which will be announced on Tuesday, to show an annualized 0.1 percent growth after being revised up from the initial estimate of a 0.8 percent contraction.

Amari also said he wants to reduce the fixed-asset tax for companies actively increasing capital spending.

“Whether firms are making losses or not, they have to pay fixed-asset tax. We are challenging and trying to lower the tax for companies that invest in new equipments, which we have never done before,” he said.

Such step could help loss-making small and medium-sized companies, and the measure may be included in an annual tax code due to be decided later this week.

The government is likely to cut the effective corporate tax rate to below 30 percent in fiscal 2016 from April, a year earlier than planned.

But the corporate tax cut won’t help loss-making small and medium-sized firms which are exempted from paying the corporate tax, Amari explained.

Firms’ capital spending has been slow to recover and the government wants companies to increase business spending to spur the economy.

Reporting by Kaori Kaneko; Editing by Simon Cameron-Moore

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