Abe needs more stimulus to raise sales tax, adviser Itoh says

The administration should consider a supplementary budget this year and will need to add stimulus for the economy to weather the planned increase in the consumption tax in 2015, according to Motoshige Itoh, a member of an advisory panel to Prime Minister Shinzo Abe.

"The current base scenario is to raise the consumption tax to 10 percent," said Itoh, a University of Tokyo professor who is part of the Council on Economic and Fiscal Policy. "The key is how to provide a stimulus package that ensures the economy escapes an extremely negative impact."

Abe will decide by the end of the year whether to raise the levy to 10 percent from 8 percent after gauging the state of the economy.