Tax hike reports misinterpreted, Ogawa says

There have been misinterpretations of media reports that Finance Minister Hiroshi Mitsuzuka hinted at another rise in the consumption tax, Vice Finance Minister Tadashi Ogawa said Mar. 24.

Speaking at a news conference, Ogawa stressed that the first step toward fiscal reconsolidation would be a review of government spending, rather than a tax hike, and called earlier news reports “regrettable.” Earlier in the day, news wires said Mitsuzuka told a session of the House of Representatives Special Committee on Taxation that another rise in the consumption tax, already set to increase by 2 percentage points April 1, was possible in the mid- to long term. “He did not in the least say that a consumption tax raise was on the table for debate now,” Ogawa said.

Taxation was an issue that needed to be discussed through a broad study of economic and social factors, the ministry’s top bureaucrat said. At the same time, he predicted that future debate on the nation’s tax system would center on the excessive weight now placed on such direct taxes as income tax, as compared with indirect taxes like those on spending.