Japanese Prime Minister Sanae Takaichi said Wednesday she wants to implement a freeze on the country’s consumption tax on food products “as soon as possible,” despite concerns over the nation’s fiscal health amid the ongoing Middle East crisis.
During a one-on-one parliamentary debate with opposition party leaders, Takaichi also said the government will do its utmost to limit debt issuance to support the public, as her government plans to draft a supplementary budget amid concerns the crisis could have a prolonged economic impact.
Her comments came as Japanese government bond yields surged to the highest level in nearly 30 years, partly reflecting market expectations of accelerating inflation in resource-scarce Japan and fears over the country’s worsening fiscal health.
Questions were led for the first time by Democratic Party for the People head Yuichiro Tamaki, as his party holds the most seats in parliament following the Centrist Reform Alliance’s defeat in February’s election and uncertainty over a merger between its two founding parties in the House of Councillors.
Parliamentary leaders’ debates in Japan were first introduced in 2000 and modeled on Britain’s Prime Minister’s Questions format. They have become increasingly rare, however, with none held for around three years from 2021, and calls for them to take place tend to be stronger among opposition parties.
The latest debate was the first since November and the second of Takaichi’s premiership, after a planned April session was canceled due to the prime minister’s schedule. Wednesday’s event also came just hours after she returned from a summit with South Korean President Lee Jae Myung in his hometown.
The first half largely focused on Takaichi’s decision Monday to tell ruling parties she had ordered a review into formulating a supplementary budget, just over a month after Japan enacted a record 122.31 trillion yen ($769 billion) fiscal 2026 budget, and a shift from her recent comments that it was not required at present.
On the timing of the consumption tax freeze, Takaichi indicated she wants to move ahead with the policy “as soon as possible” once a cross-party national council on the issue compiles its interim report this summer.
The freeze is becoming increasingly controversial, with opposition parties appearing to have watered down support for the policy amid concerns over its feasibility. Last week, the Organization for Economic Cooperation and Development described it as “untargeted and costly” and recommended that the tax be raised gradually.
Takaichi also said she “seriously reflects” on proposals from Tamaki on whether the government should consider an off-ramp from its subsidies to keep gasoline prices below 170 yen per liter at the pump. The policy, restarted in mid-March, is expected to use up its earmarked 1 trillion yen by the end of June.
While exchanges were largely cordial with Tamaki, whose party is more closely aligned with Takaichi’s Liberal Democratic Party on fiscal policy, CRA leader Junya Ogawa took an aggressive approach in his debut appearance, accusing the prime minister of moving too slowly in deciding on the supplementary budget.
Takaichi pushed back, saying she did not believe the response was delayed and that the government “had been considering the best course of action from a relatively early stage.”
In a series of questions on diplomacy from Constitutional Democratic Party of Japan leader Shunichi Mizuoka, Takaichi said she “strongly welcomes” last week’s visit by U.S. President Donald Trump to China because communication between the two countries can help maintain regional peace.
With relations between Japan and China under strain since Takaichi’s parliamentary remarks in November suggesting Japan could deploy its defense forces in the event of a conflict over Taiwan, she said she is “open” to dialogue with China and sees a need for a calm approach.
Reflecting the fragmented state of Japan’s opposition since the ruling LDP’s landslide victory in the House of Representatives election, Takaichi had only brief exchanges with leaders from six parties during the 45-minute session, with the longest allotment going to Tamaki at 12 minutes.
Other representatives who asked questions in progressively shorter allotted time slots were Komeito leader Toshiko Takeya, Sohei Kamiya of the conservative populist Sanseito party, and Takahiro Anno, leader of the technology-focused Team Mirai, which gained 11 lower house seats in the election.
Anno used the final slot to ask about the government’s artificial intelligence policy, with scrutiny growing over the threat posed to financial institutions by U.S. company Anthropic’s Claude Mythos model, drawing laughter from the chamber as he offered to become Takaichi’s personal tutor on the technology.
© KYODO
