Japanese Prime Minister Junichiro Koizumi on Monday indicated during a session of the Japanese Diet’s budget committee that he would be in favor of allowing each local government in Japan to charge its own consumption tax. The current rate of the nation’s consumption tax is 5 percent, of which 4 percent goes to the national government and the remainder to local governments, which receive it from the national government. Koizumi’s comments meant that the 1 percent tax could be charged directly by each local government. There are 50 prefectural governments in Japan and Koizumi wants to activate local autonomies instead of the present situation where everything has to be done by the central government. However, the premier said he is not willing to raise the rate of the consumption tax for the time being, and it is still unclear if, in the future, the price of goods in Japan will be different from prefecture to prefecture depending on the rate of local consumption tax. — Koji Hirano

FINER WEAVE: Itochu Corp. has begun marketing compact spun wool yarn and fabric in Japan in collaboration with European mills. Itochu said it has signed an agreement for the exclusive import of compact wool yarn from Zwickuer Kammgarn GmbH, a textile manufacturer based in Wilkau-Hasslau, Germany. The Japanese trading firm also is working with another German mill of compact spun wool yarn, which resulted in the installation of an experimental compact spinning system in its mill in Poland.

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