11th-hour bid to save tax plan

Noda pledges polls in near future amid opposition’s threat to withdraw support

TOKYO: Japanese Prime Minister Yoshihiko Noda was scrambling to save his prized consumption tax Bill after the main opposition threatened to withdraw support unless a general election is called.

Noda had looked to be on the home straight of a long and difficult bid to double sales tax and help plug Japan’s gaping budgetary hole with a final upper house vote on the legislation pegged for yesterday.

But political manoeuvring by the opposition Liberal Democratic Party (LDP) forced the premier into pledging an election “in the near future” once the legislation is approved.

Noda, a former finance minister, has put his political life on the line to hike the 5% consumption tax in what experts have hailed as a sensible way for Japan to begin tackling its huge mountain of debt.

The measure passed the powerful lower house in June with support from the LDP and its junior partner New Komeito, with Noda riding out a rebellion in his fragmenting Democratic Party of Japan (DPJ).

But the LDP has since sought to exploit the sliding popularity of the premier and his party by raising the price of its support in the upper house where the government does not have a majority.

Koriki Jojima, the DPJ’s Diet affairs chief, met with his counterparts from the LDP and New Komeito yesterday morning and requested a meeting among the leaders of the three parties to break the impasse.

Noda would tell them “he will go to the polls in the near future upon the enactment of the legislation”, Jojima told reporters yesterday.

But his LDP counterpart Fumio Kishida said the offer was short of the mark.

“We cannot accept the expression, ‘the near future’.

“I don’t see any change from what the prime minister has said in the past,” he said.

The plan to raise consumption tax to help cover ballooning welfare costs was originally proposed by the LDP, which now finds itself treading a fine line between pressing its political advantage and being seen as naked opportunists.

A shrinking workforce and a chronically stagnant economy have weighed on Japan’s tax base, where public debts have bloated to levels unseen elsewhere in the industrialised world. — AFP

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