International Monetary Fund chief Christine Lagarde urged Japan on Thursday to make sure that a nationwide consumption tax increase scheduled for next year does not hurt the country's economic growth.
"We believe that the higher consumption tax will help fund growing health and pension expenses, and support fiscal consolidation," Lagarde told a news conference in Tokyo following an annual consultation with the Japanese government.
"However, we also recommend that the 2019 consumption tax increase be accompanied by carefully designed mitigating measures to protect near-term reflation and growth momentum. We believe that the fiscal stance should certainly remain neutral at least for the next two years," she said.