Economic and fiscal policy minister Kaoru Yosano said Sunday he envisions raising the 5 percent consumption tax in stages to 10 percent.
The government is seeking to carry out tax reform in five years starting in fiscal 2011, including a consumption tax hike.
"A 5 percentage-point hike (all at once) in fiscal 2011 would give a major shock to the economy," Yosano said on a TV program.
The hike would be made "in stages," he said.
Yosano suggested that various options would be considered, such as raising the tax by 1 percentage point each year or increasing it by 2 points in fiscal 2011 and raising it by another 3 points later.
He said the revenue from the consumption take hike would be used for elder care, pensions and medical services.