A number of key members of Japan's Liberal Democrat Party have this week spoken out about the country's need for a rise in consumption tax in the coming years, in order to supply sufficient social security funds.
The current rate is 5%. However, the LDP are proposing that this needs to be doubled to at least 10% in order to ensure that adequate funding is available for social welfare spending, which reportedly consumes around a quarter of the country's annual budget.
According to a Reuters report, the LDP's policy chief, Sadakazu Tanigaki, observed that:
"How to finance the burden...is the most fundamental issue for the country's economic and fiscal policy."
He added:
"We should clearly position the consumption tax as the revenue source."
However, Prime Minister Yasuo Fukuda has recently announced, according to Bloomberg,
that: "The government is not considering raising the consumption tax right
away."
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