Policy Debate by Party Leaders

Leaders of major parties appeared in the debate sponsored by Japan National Press Club and exchanged their views on coming general election of the House of Representatives on February 8th. The debate indicated that the election campaign would be focused on consumption tax cut, framework of leading coalition and measures for increasing foreigners in Japan. 

Before Prime Minister Sanae Takaichi decided a snap election earlier this month, the opposition parties have been demanding partial or complete cut of consumption tax to support consumers. Taking those arguments as political pressure for her administration, Takaichi announced that she would consider two-year moratorium of the tax for food, to contend the idea of halving tax rate or permanent elimination for food by the oppositions.

 

In the debate, Takaichi revealed the timeline for introducing new tax policy she hoped. If a multi-partisan conference on this issue, which she hopes to launch after the election, can reach a deal to conclude consumption tax cut by this summer, she hopes to submit a bill for it to extraordinary session of the Diet this fall and apply new system within FY2026 ending March 2027.

 

The co-leader of Centrist Reform Alliance (CRA), Yoshihiko Noda, proposed elimination of the tax for food by this fall. Although Noda assumes governmental funds as fiscal resource to compensate the elimination, there is a skepticism on whether the funds are enough to cover the shortage of revenue created by the elimination, which is expected to be amounting 5 trillion yen annually. Other parties including ruling Liberal Democratic Party has not shown the fiscal resource for the tax cut.

 

As recent polls showed decline of approval rate for her cabinet, Takaichi does not look to be confident that she would be able to build a stable administration after the election. While she has been sending an invitation for the leading coalition to the Democratic Party for the People (DPP), the DPP is not excited with it. The leader of DPP, Yuichiro Tamaki, told that confidence on Takaichi was declining as she decided a snap election before passing FY2026 budget bill, which includes DPP’s demand for raising threshold of imposition of income tax. On a speculation of joining a grand coalition by all the major parties, Noda clearly denied that idea.

 

Populist parties, namely Sanseito, focuses on stricter regulation on increasing foreigners in Japan. Takaichi once told in LDP presidential election that foreign travelers kick deers in Nara Park, appealing her populist view to independent voters. LDP’s coalition partner, Japan Innovation Party, also advocate controlling foreigners in Japan, injecting “quantitative management” of foreigners in the agreement for forming coalition with the LDP last October. The CRA offers a contrast from those policies toward foreigners, promoting multi-cultural and co-existent society.

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