Taxes and saving habit

Mr Abe's comment in meeting with other G7 leaders shows that he is likely to delay the previous planned increase in consumption tax. An increase in the tax can cause a decrease in consumption as it makes goods and services more expensive. However, as we know that the Japanese government has put much effort to increase the domestic inflation, the increase in tax may help to achieve this, if there is a social habit of saving. When the tax increases and people have sufficient income and savings, people need to reduce their savings to spend on consumption in order to maintain their original standards of livings. Japan is a country that has a social saving habit; therefore, I think that if the Japanese government can choose to increase taxes on consuming specific goods and services, it can help to reduce the people's savings, improve the government budget without reducing much consumption in the economy. The increase of government incomes from taxes can help to increase the investment level in the economy, which is another encouraging reason to increase taxes.