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Hiking the tobacco levy would be one way to offset a continuing decline in overall tax revenues, Prime Minister Yukio Hatoyama said Friday, reiterating that his government will scrap gasoline and other road-related tax surcharges as promised.

“I think it should be possible to raise the tobacco tax in light of (its impact on) the environment and public health,” Hatoyama told reporters in the evening when asked his opinion on the tax system.

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