Japan’s ruling party agreed on a plan to double the sales tax by 2015 after weeks of internal debate and a member revolt as Prime Minister Yoshihiko Noda fights to head off another credit-rating downgrade.
The proposal decided on late yesterday would raise the sales tax from 5 percent to 8 percent in April 2014 and to 10 percent in October 2015. The details must be approved by a government panel led by Finance Minister Jun Azumi before discussion with an opposition whose Liberal Democratic Party has already hinted it may not back them.
Election Call
After the defection, LDP leader Sadakazu Tanigaki said Noda should call an election.
“The DPJ promised not to raise the sales tax and they’re going to raise it,” Tanigaki told reporters on Dec. 28. “Noda is staking his job on this, so he should call an election to ask the public.”
Noda’s approval rating dropped to 31 percent from 40 percent last month, according to an Asahi newspaper telephone survey of 1,655 voters taken Dec. 10-11. The same survey showed the public divided on doubling the sales tax by 2015, with 45 percent in favor and 45 percent opposed. Asahi didn’t give an error margin.
“Unless we send a message that we’ll maintain social security and fiscal discipline, we could find ourselves in a crisis,” Noda told party members yesterday.
