Koichi Kato, secretary general of the ruling Liberal Democratic Party, Tuesday said that the target year for fiscal reform can be moved back by two years from the original goal year -- a step that would provide flexibility in working out economic stimulus measures.
While the Fiscal Structural Reform Law says that the issuance of deficit-covering bonds must be terminated by the end of fiscal 2003, Kato said that date can be extended to 2005, opening the way for more pump-priming measures such as the implementation of large-scale tax cuts.
"Although I believe various measures can be taken within the limit of the fiscal reform law, the target year can be extended if it is necessary," Kato told reporters. "Permanent income tax cuts, for instance, cannot be implemented under the current framework of the law."