Shinshinto said Wednesday that Prime Minister Ryutaro Hashimoto's sudden announcement of a 2 trillion yen tax cut demonstrates the failures of his administration's economic policies.

Takeshi Noda, policy chief for the largest opposition party, told a news conference that the decision to introduce the one-time tax cut is too late to effectively lift the stagnant economy. "We have been saying that the current economic failure was caused by incorrect policies," Noda said. "We strongly demand that the Hashimoto administration resign to take responsibility for causing this."

Noda said the tax cuts should not be one-time measures but should continue. This would prompt consumers to spend -- instead of feeling obliged to save their windfall -- and help the economic recovery.

Naoto Kan, leader of the Democratic Party of Japan, the second largest opposition force, criticized Hashimoto for inconsistent policies. "The prime minister should make it clear whether he has given up an earlier policy of fiscal restraint," Kan said. "What the Hashimoto administration has done seems to be just the repetition of haphazard policies." Still, Kan welcomed the government's decision to implement the tax cuts, saying it is in line with what the DPJ has demanded.

The Taiyo Party said the government is merely following what it has been calling for and should admit its responsibility for causing the economic turmoil.

The Japanese Communist Party said Hashimoto's decision shows a failure of the government's economic policies, which have included an ill-timed increase in the consumption tax despite the weakened economy. The JCP also demanded that the tax cuts be permanent and that the consumption tax rate be returned to 3 percent.

The Social Democratic Party, one of two smaller non-Cabinet allies of the LDP, welcomed the decision. However, Hiroyuki Sonoda, secretary general of New Party Sakigake, the other ally of the LDP, expressed concern that the tax cuts would run counter to the government's fiscal austerity efforts and might damage public trust in the administration's policy consistency.