The Social Democratic Party said Oct. 9 that it is finalizing details of its proposal for a one-time tax cut of about 2 trillion yen, SDP Secretary General Shigeru Ito said.The party, one of the two non-Cabinet allies of the ruling Liberal Democratic Party, will compile its proposal next week as a supplementary budget, Ito said. Because the party is reluctant to introduce measures that would create an additional fiscal burden, finding fiscal resources is the major concern. The SDP will also consider the contents of the tax cuts, such as an income tax reduction, special tax cuts for small and medium-size companies and tax exemption for groceries, according to SDP officials.Separately, Finance Minister Hiroshi Mitsuzuka left the door open for tax breaks from budget spending cuts to help prop up the economy. He added that issues related to taxation should be debated by the government’s Tax Commission and a counterpart panel in the LDP.Mitsuzuka has ruled out special income tax reductions because they would require the issue of deficit-covering bonds and push the nation further into debt. However, some LDP lawmakers have suggested that roughly 300 billion yen could be shaved from the current fiscal year’s budget and used to allow small-scale tax cuts to stimulate the economy.
SDP wrapping up details of 2 trillion yen tax cut