Liberal Democratic Party Secretary-General Sadakazu Tanigaki said Friday the second stage of the consumption tax rate hike should proceed as planned next year, but said the ruling party is closely monitoring the economic situation.
“The railroad (toward the hike) is already there. So what we should do now is work to create the economic climate smoothly,” Tanigaki told journalists in Tokyo.
The government plans to double the sales tax to 10 percent in October 2015 to follow up on the first stage of the hike to 8 percent from 5 percent this past April.
“I’m not saying that we must raise the consumption tax at any cost,” he said. “We must watch the economic situation closely and, if necessary, implement a range of measures.”
Tanigaki, 69, took over the ruling party’s No. 2 post on Sept. 3. As leader of the party in August 2012, when it was in the opposition, he helped clinch the cross-party agreement on the two-stage hike. The other parties were New Komeito head Natsuo Yamaguchi and then-ruling Democratic Party of Japan chief and Prime Minister Yoshihiko Noda.
“There is already a law for this. And the law stipulates that we raise the consumption tax rate from 8 to 10 percent,” Tanigaki said.
Although the tax hike is scheduled to take place next year, Prime Minister Shinzo Abe is expected to make the final decision by year’s end.
Meanwhile, Tanigaki spoke of Japan’s relations with its neighbors.
A political dove who favors a rapprochement with China, Tanigaki underscored the need for good ties with both China and South Korea at a time when relationships with them have deteriorated amid claims and counter-claims over territorial disputes and alleged historical injustice.
Noting that governments are responsible for diplomacy, he said the LDP is constantly considering ways to improve ties.
“Our party used to pursue multiple initiatives and strive to improve bilateral relationships. Whether we can start something similar or not is the big question for us,” he said.
Tanigaki’s other important task is to secure victory for his party in the nationwide general election scheduled for next spring.
He said an important factor in local support will be regional revitalization.
“Each region is facing surprisingly similar problems, such as a shrinking and graying population and lack of jobs for young people. . . . But I believe the effective prescription for the each region is different,” he said.
“It’s not easy to create different prescription for each. I know what I’m saying is too abstract. . . . But I believe we will not see results without it.”
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