Anatomy of a Sales tax Increase Shrinking Consumption

What happened when Japan increased its sales tax? Consumption declined

The numbers:

• 2% increase in sales tax nationally on Oct 1st
• The economy shrunk by 6.3% in the October-December quarter
• The forecast was a 3.9% rate of shrinking
• largest economic contraction since 2014, the last time the national sales tax increased

Wall Street Journal | Japan’s Economy Shrinks 6.3% as Sales-Tax Increase Cools Consumption