Takaichi defends plan to combine consumption tax cut with income-based cash payments
Designing a system of direct cash payments tailored to recipients' incomes takes longer than distributing uniform amounts, the prime minister said.
Prime Minister Sanae Takaichi defended her proposal to merge a consumption tax reduction with income-based cash payments during questioning about Lower House inquiries. When asked by opposition leader Mitsunari Okamoto if direct cash payments alone could provide quicker relief from rising costs of living, Takaichi argued that the tax cut and targeted payments would increase household disposable income and set the stage for a long-term tax credit plan.
The 8% consumption tax would be reduced to 1% starting April 2027, with the reduction lasting for two years. Legislation to implement the combined package is expected to be introduced during the current legislative session.
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