A subcommittee of the Fiscal System Council proposed Thursday that tariffs be imposed on salt imports for up to three years when Japan "frees up" its salt market on April 1.
The proposal, submitted to Finance Minister Masajuro Shiokawa, would protect the domestic salt industry from foreign competition, which the subcommittee fears could be severe.
The proposal states that "a certain level of tariffs is necessary to equalize conditions for competition with imported salt."
The subcommittee claims the tariffs will help bridge the price difference between imported salt and domestically produced salt and should constitute a kind of moratorium during which the domestic industry "promotes" structural reforms.
Sukehiro Hosono, who heads the salt division within the subcommittee and is a Chuo University professor, said the panel favors liberalizing the salt market. He said, however, that the imposition of tariffs would be a necessary "shock absorber" for the domestic industry, which will need to deal with a changing business environment.
The government monopoly on salt production was scrapped in 1997. Domestic salt producers have since been protected, however, by a five-year "preparatory" period before the market is liberalized.
The Fiscal System Council operates under the auspices of the Finance Ministry.