Raising corporate and household income taxes to fund a planned increase to Japan's defense budget in the next fiscal year cannot be ruled out, the head of the ruling Liberal Democratic Party's tax policy panel has said.
The government is set to boost its military spending in the face of rising China's might and geopolitical uncertainty involving Taiwan and North Korea's missile developments.
With public debt at more than double the size of its economy, Japan has little room left to increase the funding, leaving the country with options such as spending cuts, tax hikes and additional debt issuance.