Just over a week after Prime Minister Fumio Kishida announced a game plan for increased defense spending that included additional taxes, he was forced to punt in the face of a stronger than expected opposition blitz from within his own party.
While the ruling Liberal Democratic Party’s tax panel agreed Thursday to raise taxes in order to reach Kishida's goal of having defense spending equal 2% of gross domestic product by 2027, the final agreement says only that they will be levied at the appropriate time, leaving questions about when, or even if, new taxes might be established.
Kishida, who had been pushing for increases in several stages, was forced to back off from a specific timetable for tax hikes to pay for defense spending of ¥43 trillion over the next five years, starting in the 2023 fiscal year, due to anger and opposition from LDP members who demanded that he consider issuing government bonds to pay for at least some of the increase.