Heavyweights in Abe’s Party Try to Damp Talk of Tax Hike Delay
Japan needs to raise the levy to secure stable funds to sustain a social welfare system over the long term: Taro Aso
(Bloomberg) -- Senior Japanese lawmakers sought to hose down talk on Friday that the government may consider delaying a planned increase in the nation’s sales tax in October.
Finance Minister Taro Aso said there was no change to his stance that the hike will go ahead, unless an economic crisis like the global financial meltdown a decade ago occurs. Japan needs to raise the levy to secure stable funds to sustain a social welfare system over the long term, he said.
Chief Cabinet Secretary Yoshihide Suga echoed this view.
Even Koichi Hagiuda -- who set tongues wagging on Thursday by suggesting that bad economic data later this quarter could put the plans on ice -- walked back his own position. There’s no change to the government’s intentions and any delay would need approval from voters, said Hagiuda, who is the acting secretary-general of the Liberal Democratic Party.
Yet making the comments in the first place underscores rising concern about the tax among Prime Minister Shinzo Abe’s ruling party.
Previous increases in the levy have thrown the economy into reverse. It’s scheduled to rise to 10 percent from 8 percent on Oct. 1.
Akira Amari, the election campaign chairman of the LDP, said earlier in the week that the government needed to firmly assess the scale and effectiveness of its countermeasures to limit the economic impact of the tax.
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To contact the reporter on this story: Brett Miller in Tokyo at bmiller30@bloomberg.net
To contact the editors responsible for this story: Brett Miller at bmiller30@bloomberg.net, Henry Hoenig
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