TOKYO, Jan 25 — Prime Minister Sanae Takaichi has said that she aims to begin implementing a two-year suspension of the eight per cent consumption tax on food and beverage items within fiscal 2026, starting in April, the Kyodo News Agency reported.
"My idea is that the two-year (break on food tax) would bridge the period until a refundable tax credit system is designed and implemented," she said during a TV programme. Reducing the tax rate has become a major point of debate in the lower house election on February 8.
In a policy speech in Parliament in October 2025, after becoming Prime Minister, Takaichi vowed to prioritise tackling rising living costs and said the government would begin designing a system to introduce a mix of income tax deductions and cash benefits for low- and middle-income households.
Japan's consumption tax is set at eight per cent for food and beverages and at 10 per cent for most other products.
The Centrist Reform Alliance, the new party pitching centrist policies and now the country's largest opposition force in the House of Representatives, has made abolishing the consumption tax on food its campaign centrepiece.
The alliance's co-leader, Yoshihiko Noda, said on the same programme that around ¥10 trillion (RM253.5 billion) in funding would be needed to scrap the tax.
"I will do my utmost to implement this within the year without issuing deficit-financing bonds," he said, adding that should legislation be enacted at an early date, scrapping the food tax would be possible in the fall.
Among the seven representatives of the ruling and opposition parties present during the programme, Democratic Party for the People (DPP) head Yuichiro Tamaki was the only one who did not agree to the fiscal 2026 timeframe.
"We must thoroughly discuss the matter, considering the impact a tax reduction would have on eateries, among others," he said. The DPP has called for a five per cent reduction in the consumption tax rate.
