Japan PM says stores risk reputational damage if food tax cut not reflected in prices

On October 1st, Japanese Prime Minister Sanae Takaichi stated that supermarkets might face reputational harm if they do not pass a planned reduction in consumption tax on food and beverages to consumers, dismissing worries about the cut potentially fueling inflation. Bills pertaining to the tax reduction are anticipated to be deliberated during an emergency Diet session starting October 5th.

During a Nippon Television Network program preceding the Diet session, Takaichi affirmed that the tax rate reduction would generally be mirrored in prices, adding that if prices did not decrease, it could negatively impact stores' reputations. She dismissed concerns that demand stimulated by the tax cut on food items could lead to price hikes, asserting that these are daily necessities with expiration dates, and the effect of people stocking up on them causing consumption to surge sharply is relatively limited.

Reflecting on her administration's impending first anniversary, Takaichi noted that she has successfully initiated work on her top priorities as prime minister. When asked about her prospects of seeking re-election in the Liberal Democratic Party presidential election next autumn, she refrained from providing an answer, focusing instead on fulfilling the promises she has made.