Japan's annual tax revenue likely hit a record high for the third straight year in fiscal 2022 and may have reached the 70 trillion yen ($500 billion) mark for the first time, government data showed Thursday.
The rising trend reflects an increase in consumption tax revenue amid rising prices of every goods and companies paying more taxes on their income as the negative impact of the COVID-19 pandemic continues to wane.
Tax revenue finalized by the end of April for fiscal 2022, which ended in March, rose 8.1 percent from a year ago to 61.53 trillion yen, the largest-ever for the period, the Finance Ministry said.
While the fiscal year has already ended, the total tax revenue figure has yet to be finalized because many of the firms that closed their books at the end of March have still to pay all their taxes.
Japanese manufactures have seen their earnings recover after they took a hit from the COVID-19 pandemic, which depressed economic activity and disrupted supply chains.
The yen's precipitous drop last year, especially against the U.S. dollar, also proved a tailwind for exporters because their overseas earnings were inflated when brought back home.
The service sector had lagged behind manufacturers in their recovery but the lifting of antivirus curbs and a revival of inbound tourism, albeit at a gradual pace, boosted demand.
