Polls show support for food tax cut — but also concern over its cost
The impact of the measure on government finances and whether the tax can be restored to its original rate after two years are among the major concerns.
Recent opinion polls reveal mixed reactions from the Japanese public regarding Prime Minister Sanae Takaichi's administration's planned tax cut on food. While support remains relatively stable, concerns over the policy's financial implications are growing.
Cabinet approval ratings have remained consistent at around 41-56%, with a slight decline in Mainichi Shimbun's survey. However, there is a notable uptick in public approval of Takaichi's administration, with ANN reporting a 6.2 percentage point increase to 55.4%.
The government's proposal to reduce the consumption tax on food from 8% to 1% for two years starting in April 2027 has garnered mixed reactions. Support for the policy stands at 54% in Yomiuri's survey and 52.7% in a Kyodo News poll, while 47% favor it and 42% oppose it in ANN's survey. Mainichi's survey, however, shows a stark contrast, with 47% viewing the policy negatively and 33% positively.
The main concern revolves around the impact of the tax cut on government finances. A significant proportion of respondents expressed worry in Kyodo's and ANN's polls that the reduction could jeopardize the government's ability to sustain its social security system. Additionally, there are doubts about the government's capacity to restore the tax to its original rate after two years.
Nomura Research Institute estimates that the tax reduction alone would cost approximately ¥4.4 trillion ($27.7 billion) annually. The government plans to avoid issuing deficit-covering bonds and instead seek funding through subsidies, special tax breaks, and nontax revenues. However, they have not yet identified sufficient sources to cover the measure's cost.
The ruling parties aim to finalize a tax reform outline for the measure in September, with the legislation expected to be submitted during the autumn session of parliament. Chief Cabinet Secretary Minoru Kihara emphasized the need to explain the purpose of the tax cut and funding strategy to gain public understanding and secure market confidence.
Written by urgent.news from Japan Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
