The nation has no choice but to make salaried workers pay more taxes to put its finances in order.

This infamous remark, uttered in June by Tax Commission chief Hiromitsu Ishi, angered a public that has been forced to cut back on daily living expenses while seeing average private-sector wages steadily shrink since 1997.

Ishi's words were a reminder that an age of drastic tax hikes is just around the corner in Japan, where the central and local governments combined long-term deficits are expected to hit 775 trillion yen -- about 1.6 times the size of its gross domestic product -- at the end of fiscal 2006.