Japan's Ishiba calls for debate on pros and cons of sales tax cut
Cutting the sales tax could increase household income temporarily, but would raise questions on how to pay for Japan's ballooning social welfare and pension costs, Ishiba told a news conference.
"There needs to be a common understanding over the facts" on the pros and cons of a sales tax cut, Ishiba said. "Just looking at one side of the debate won't do," he added.
Ishiba spoke after vowing to remain in office despite his ruling coalition's defeat in upper house elections, which analysts blame in part on voters' frustration over rising living costs.
The premier has repeatedly brushed aside calls from opposition parties to cut Japan's sales tax rate, currently set at 10 per cent except for an eight per cent levy on food products.
In the news conference, Ishiba urged other parties to join discussions on how to cushion the blow from rising inflation, while being mindful of the responsibility to keep Japan's fiscal house in order.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New Straits Times
43 minutes ago
- New Straits Times
Who could replace Japan's Ishiba as leader of the ruling party?
TOKYO: Japan's Prime Minister Shigeru Ishiba plans to announce his resignation by the end of next month, media said on Wednesday, following a bruising defeat in an upper house election. That step would trigger a leadership race in his Liberal Democratic Party (LDP), with the winner facing a parliament vote to become prime minister of the world's fourth-largest economy. However, the selection process may not be smooth, since the LDP and its junior coalition partner Komeito lack a majority in both houses of parliament. SANAE TAKAICHI, 64: A Yomiuri newspaper poll following Sunday's election showed Takaichi as the top pick for prime minister in an LDP-led government, with 26 per cent of votes, followed by farm minister Shinjiro Koizumi, at 22 per cent. Representing the party's right wing, she lost to Ishiba in the September leadership race in a run-off vote. Takaichi previously served as Japan's economic security minister, internal affairs minister and the LDP's policy council chief. She is known for her conservative views, such as revising the pacifist constitution, and is a regular visitor to the Yasukuni war shrine, viewed by some Asian neighbours as a symbol of past militarism. She also opposes allowing women to retain their maiden names, saying it would undermine tradition. Takaichi courted controversy in 2016 when she suggested the government could revoke broadcasting licences of media companies deemed to be politically biased. SHINJIRO KOIZUMI, 44: The son of a former prime minister and heir to a political dynasty with a hand in governing Japan for more than a century, he would become its youngest prime minister in eight decades if he succeeded Ishiba. Koizumi also ran in the last party leadership race, presenting himself as a reformer able to restore public trust in a party mired in scandal. Unlike Takaichi, who left government after her defeat in that contest, the Columbia University-educated Koizumi stayed close to Ishiba as his agriculture minister, overseeing the release of rice stockpiles in a bid to curb soaring prices of the staple. TOSHIMITSU MOTEGI, 69: A former foreign minister, Motegi has a reputation as a tough negotiator and handled talks with US Trade Representative Robert Lighthizer when President Donald Trump was last in office. He has also served as trade minister, economy minister and the party's secretary general. He studied at the Harvard Kennedy School and worked at the Yomiuri newspaper and consulting firm McKinsey before entering politics in 1993. Other potential candidates include Chief Cabinet Secretary Yoshimasa Hayashi, 64, and Finance Minister Katsunobu Kato, 69.
New Straits Times
an hour ago
- New Straits Times
Nikkei, EU stocks surge as US-Japan trade deal avoids the worst
SYDNEY: Japanese shares surged to a one-year high on Wednesday as the country struck a trade deal with the United States that lowers tariffs on its autos, while also reviving hopes for a EU-US agreement that boosted European stock futures. President Donald Trump on Tuesday said a trade deal with Tokyo will include Japan paying a lower-than-threatened 15 per cent tariff on shipments to the US It followed an agreement with the Philippines that will see the US collect a 19 per cent tariff rate on imports from there. Trump also said representatives from the European Union were coming for trade negotiations on Wednesday. That stirred hopes for a deal with Europe, even as the EU was reportedly refining countermeasures in case of a deadlock before the August 1 deadline. EUROSTOXX 50 futures jumped 1.3 per cent, while Germany's DAX futures climbed 0.6 per cent. "Expectations for a breakthrough (on the US-Japan talks) were low, so Trump's announcement delivers a mild upside surprise — providing near-term relief for Japanese equities," said Charu Chanana, chief investment strategist at Saxo. "Strategically, the deal allows Japan to sidestep immediate tariff escalation, while Trump's attention shifts elsewhere." Japan's Nikkei bolted 3.7 per cent higher as shares of automakers surged on news the deal would cut the US auto tariff to 15 per cent, from a proposed 25 per cent. Mazda Motor rallied 17 per cent, while Toyota Motor jumped 13.6 per cent. South Korean automakers also rallied as the Japan deal fuelled optimism over potential progress in tariff negotiations between South Korea and the United States. Analysts noted the trade deal reduced a major risk to the fragile Japanese economy, providing more scope for the Bank of Japan to raise interest rates to fight inflation. That slugged the bond market, with yields for 10-year JGBs rising a whopping 8.5 basis point to 1.585 per cent. There were also reports Japanese Prime Minister Shigeru Ishiba would soon step down to take responsibility for the ruling coalition's defeat in Sunday's upper house election. The political uncertainty reversed an early trade-inspired rise in the yen and helped the dollar nudge up 0.2 per cent to 146.95 . Saxo's Chanana said Ishiba's departure could set the stage for leadership more aligned with pro-market policies and closer US ties. "His exit is also seen as clearing a path for continuity in Japan's accommodative fiscal and monetary stance." EXTENDED DEADLINES In another positive development, US and Chinese officials will meet in Stockholm next week to discuss an extension to the August 12 deadline for negotiating a trade deal, Treasury Secretary Scott Bessent said. Chinese blue-chips rose 0.7 per cent and Hong Kong's Hang Seng index gained 0.8 per cent. MSCI's broadest index of Asia-Pacific shares outside Japan added 1.0 per cent. Wall Street was more restrained with S&P 500 futures up 0.2 per cent, while Nasdaq futures added 0.1 per cent. US corporate earnings reports were showing signs that Trump's trade war was hitting profit margins. General Motors tumbled 8.1 per cent after the automaker reported a US$1 billion hit from tariffs to its quarterly results. Investors are now awaiting results from Tesla and Google's parent Alphabet - two of the Magnificent 7 stocks that have driven much of the market rally fuelled by AI optimism. In the foreign exchange market, the dollar consolidated having slipped overnight in line with Treasury yields. The dollar index was a shade firmer at 97.45, after losing 0.4 per cent on Tuesday in its third session of declines. The euro dipped 0.1 per cent to US$1.1737, after rising 0.5 per cent the previous day. The European Central Bank is expected to hold rates steady on Thursday after eight consecutive rate cuts, with the prospect of steeper-than-expected US tariffs looming. Benchmark 10-year US Treasury yields ticked up 2 basis points to 4.36 per cent, after slipping 3 bps overnight. While Trump continued to lash out at Federal Reserve Chair Jerome Powell for not cutting interest rates, Bessent said there was no need for Powell to step down immediately and could stay until next May if he chose. Investors have been worried the politicisation of the Fed could ultimately lead to rates being cut too far, fuelling inflation and pushing up long-term borrowing costs. In commodity markets, Spot gold prices eased a touch to US$3,422 an ounce. Oil prices nudged higher, helped by rising prices for diesel in the US where stockpiles are at their lowest levels for this time of the year since 1996. US crude rose 0.4 per cent to US$65.60 per barrel, while Brent was at US$68.88 per barrel, up 0.4 per cent.
The Sun
an hour ago
- The Sun
Trump announces US-Japan LNG joint venture in Alaska
TOKYO: US President Donald Trump stated on Tuesday that Japan would form a joint venture with the US to develop a liquefied natural gas (LNG) project in Alaska. However, a Japanese government official overseeing resource development said they were unaware of any such agreement. Trump made the announcement while addressing lawmakers at the White House, where he discussed trade relations with Japan. 'We concluded the one deal ... and now we're going to conclude another one because they're forming a joint venture with us at, in Alaska, as you know, for the LNG,' he said. 'They're all set to make that deal now.' It remains unclear whether Trump was referring specifically to the proposed $44 billion Alaska LNG project, which includes an 800-mile pipeline and a liquefaction plant for exports. The Ministry of Economy, Trade and Industry (METI) official stated they were working to verify Trump's remarks. Japanese firms, including major LNG buyers JERA and Tokyo Gas, have previously shown interest in the Alaska LNG project but emphasized the need to evaluate costs and other conditions before committing. A JERA spokesperson could not confirm the joint venture mentioned by Trump, while Tokyo Gas declined to comment, stating they were not involved in any such agreement. Other potential buyers, such as Thailand's PTT and India's GAIL, have also expressed interest in the project.
