The ruling Liberal Democratic Party’s powerful tax commission opened discussions Friday on tax reform for fiscal 2003, taking up the issue of how best to handle a proposal to implement cuts and hikes as one package over a number of years, according to a senior member of the commission.
Although the government intends to implement tax cuts of more than 1 trillion yen for fiscal 2003 as a way of shoring up the economy, the country’s tight fiscal conditions means tax hikes will be necessary in later years.
Finance Minister Masajuro Shiokawa and Toranosuke Katayama, head of the Public Management, Home Affairs, Posts and Telecommunications Ministry, joined the meeting of the LDP’s Research Commission on the Tax System.
The two ministers took questions and listened to the opinions of commission members regarding the progress of discussions by the government’s Tax Commission and the Council on Economic and Fiscal Policy, both key government panels, the member said.
The tax commission is expected to take up a number of controversial issues such as increasing the tax base for individual income and the introduction of a pro forma tax as a local tax on companies.