The government needs to raise the consumption tax to cover swelling social security costs and help restore the national fiscal health, new economic and fiscal policy minister Kaoru Yosano suggested.
But the government faces the difficult task of balancing policies for fiscal discipline and those to stimulate growth, Yosano said in an interview after being appointed to his post by Prime Minister Yasuo Fukuda in last week's shakeup.
"How we can finance the social security system?" he asked. "We need certain fiscal revenues to maintain social security policies.