Tokyo, Oct. 20 (Jiji Press)–Deliberations began in the House of Representatives, the lower chamber of the Diet, Japan’s parliament, on Tuesday on bills to cut the consumption tax on food and introduce an income-linked benefit program. During a plenary session of the Lower House, the purpose of the bills was explained, and interpellation was held on the legislation, with Prime Minister Sanae Takaichi in attendance. Opposition parties plan to focus their questioning on the roughly 5 trillion yen in annual funding needed to cover the revenue loss from the tax cut and the design of the income-linked benefit system. This would be the first consumption tax reduction since the tax was introduced in 1989 if the bills pass. The Japanese government as well as the ruling coalition of the Liberal Democratic Party and the Japan Innovation Party have positioned the bills as the most important legislation of the current Diet session, aiming to secure approval by the Lower House by early November. Although the opposition Conservative Party of Japan has expressed support for the legislation, there is still no clear prospect of its passage in the Senate, the upper chamber, where the ruling coalition lacks a majority. Attention is focused on whether the ruling camp can secure enough support for the bills in the Upper House to clear the majority threshold by compromising with opposition parties. “We would like to carefully consider the views of opposition parties and seek agreement where possible,” LDP Executive Acting Secretary-General Koichi Hagiuda said at a press conference. Meanwhile, Yuichiro Tamaki, leader of the opposition Democratic Party for the People, told a separate press conference, “We are not opposed to the bills from the outset,” indicating his intention to call for revisions to the bills. The legislation would lower the 8 pct consumption tax rate for food items to 1 pct for two years starting in April 2027 and introduce an income-linked benefit system for low- and middle-income earners. The government will provide benefits corresponding to a 1 pct consumption tax for the first two years before fully implementing the system from fiscal 2029. Meanwhile, the DPFP submitted a counterproposal to the government bills to the Lower House the same day. The counterproposal aims to reduce annual household burdens by around 50,000 yen through income and resident tax cuts and benefit payments. Komeito, also an opposition party, has called for benefits of 80,000 yen per person, while the Constitutional Democratic Party of Japan is also advocating benefit payments. END [Copyright The Jiji Press, Ltd.]
