Tokyo, Nov. 6 (Jiji Press)–The House of Representatives, the lower chamber of the Diet, Japan’s parliament, passed a bill Friday to cut the consumption tax on food and beverage items as a temporary measure to address soaring prices. The bill was approved by a majority vote at a plenary meeting of the Lower House, with support from the ruling Liberal Democratic Party and its coalition partner, the Japan Innovation Party, while all opposition parties voted the other way. It was then sent to the Senate, the upper chamber. The opposition camp criticized the lack of transparency in financial resources for the tax cut and the design of a new benefit program. The government and ruling parties aim to have the Diet pass the bill into law at the Senate by the Dec. 12 end of the current extraordinary session. On Friday, the LDP and the opposition Constitutional Democratic Party of Japan agreed to start Senate deliberations on the bill at a plenary meeting Wednesday. Not having a majority in the upper chamber, the LDP and the JIP are expected to seek support from the Democratic Party for the People and Komeito, both opposition parties, to ensure the enactment of the legislation. Prime Minister Sanae Takaichi answered questions from opposition parties at a meeting of the Financial Affairs Committee of the Lower House prior to the plenary session. She said that 30 pct or more of workers in Japan would be eligible for aid under the income-linked benefit program to reduce burdens on low- and middle-income earners. The government previously said that about 20 million people with annual incomes of 1 million to 3.5 million yen, accounting for 30 pct of all workers, would be eligible for the program. Takaichi apparently aimed to gain the understanding of opposition parties by mentioning the expansion of eligibility for benefits. After the deliberations at the committee meeting, the ruling and opposition parties agreed to hold a vote on the bill at the committee and send it to the plenary meeting. “The prime minister gave detailed answers,” Shinichi Isa of Komeito, head of the opposition side at the board of the committee, told reporters. “We have decided to put the bill to votes in order to allow deliberations to proceed in the Senate.” DPFP chief Yuichiro Tamaki expressed concern about an expected increase in the burden on the middle-income class after the end of the tax cut. “The lack of an adequate explanation from the ruling side about how to address the problem was the biggest reason for our opposition to the bill,” he said. “Details of the bill have not been clarified, so this amounts to disregard for the legislature,” Yuichi Goto of the Democratic Reform Party said. The bill would cut the consumption tax rate to 1 pct from 8 pct for foods and beverages for two years from April 2027 and introduce an income-linked benefit program to support low- and middle-income earners. The benefit program will be implemented on a scale equivalent to 1 pct of the consumption tax for foods and beverages for the first two years, before being fully introduced in fiscal 2029. The consumption tax reduction would be the first since the levy was introduced in 1989. END [Copyright The Jiji Press, Ltd.]
