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Japan dangles corporate tax cuts to spur investment, pay raises

But latest Abenomics measures weak on boosting potential growth

Japan should lead the productivity revolution, Prime Minister Shinzo Abe said.

TOKYO -- Japan promises to create a productivity revolution by cutting taxes on businesses that increase pay and invest in technologies, but the country remains reluctant to go deeper with deregulation that could help unleash innovation. 

The cabinet signed off Friday on a new economic package that touts the twin goals of boosting productivity and developing human capital. The document also includes telecommunications-sector deregulation to change how spectrum is allocated, as well as free early childhood education for all income levels. But overall, the measures seem focused more on wealth redistribution and lack punch in lifting the potential growth rate.

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