The Social Democratic Party plans to oppose a bill authorizing the issuance of deficit-covering bonds and another on reviewing taxation, a senior member of the small opposition party said Sunday.
The ruling Democratic Party of Japan is trying to get these bills through the divided Diet together with its other budget-related bills, but the SDP’s opposition puts that possibility at risk because the largest opposition force, the Liberal Democratic Party, is also planning to block the bills.
Tomoko Abe, chair of the SDP’s policy board, said in a televised debate on NHK that her party will officially decide on a course of action in the Diet on Tuesday, when its members in both houses are due to meet. She said the party will convey its decision to the DPJ when the secretary generals of the two parties decide to meet.
Abe said the bond issuance bill “has a bunch of problems” and that her party cannot agree to it.
“We cannot approve the bill if the bonds to be issued are to fill the hole caused by cutting the corporate tax rate and to extend Japan’s contribution to the cost of stationing U.S. troops in Japan for five years,” she said.
The bill to review taxation includes a tax cut that would reduce the effective corporate tax rate by 5 points.
“We do not think cutting the corporate tax rate can be a measure to counter deflation,” said Abe. “We think the bill will not pass.”
Abe also criticized another bill to extend child-rearing allowances in fiscal 2011, which starts in April.
If the bond issuance bill is voted down, the government will be unable to issue debt to make up for a ¥38.2 trillion shortfall in the ¥92.4 trillion budget for fiscal 2011.
Under the Constitution, the budget can take effect even if the Upper House rejects it. The other bills related to the budget, however, must be approved by the upper chamber, or if rejected, overridden by a two-thirds vote in the Lower House.
The DPJ-led coalition does not control the House of Councilors and is scrambling to build a two-thirds majority in the Lower House.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.