Abolishment and Resumption of Subsidies
Prime Minister Sanae Takaichi announced that her government would reduce subsidy for gasoline starting December, due to shortage of budget for it. Instead, she will also bring back other subsidy for electricity and gas. Unexpected exacerbation of situation in Middle East gives Takaichi no choice but cutting support for households. Her economic policy, based on populism, is facing an obstacle as she promotes consumption tax cut for next April. The government of Japan, led by prime minister Fumio Kishida, introduced subsidy to keep gasoline price against oil price hike in January 2022. After Russia invaded Ukraine in the next month, energy price steeply rose, making fundamental support for consumers inevitable. The subsidy was once finished at the end of 2025. However, U.S. President Donald Trump, with Israeli Prime Minister Benjamin Netanyahu, began war against Iran in February 2026. Takaichi resumed the subsidy in March to keep retail price of regular gasoline...