Special Reconstruction Tax Revenue Eyed for Defense Spending

Politics Lifestyle

Tokyo, Dec. 10 (Jiji Press)--Some in Japan's government and ruling bloc are considering diverting part of revenue from the special income tax related to postdisaster reconstruction to cover the planned hike in defense spending, it was learned Saturday.

The government and the Liberal Democratic Party-led ruling coalition will examine the idea alongside other possible options such as hikes in the corporate, tobacco and inheritance taxes, and a levy on well-off people, in order to secure 1 trillion yen a year through tax measures from fiscal 2027 to finance the defense spending increase, informed sources said.

They hope to come to a certain conclusion by Thursday, when the ruling camp is slated to draw up its fiscal 2023 tax system reform package.

The special income tax was introduced to help cover costs for the reconstruction of areas damaged by the March 2011 earthquake and tsunami, which mainly hit northeastern Japan, with 2.1 pct of the amount of the regular income tax levied additionally for 25 years until 2037.

On how to finance the envisioned hike in defense spending, Prime Minister Fumio Kishida, also LDP president, said Thursday that the government does not plan to take measures leading to an increase in individual income tax burdens.

[Copyright The Jiji Press, Ltd.]

Jiji Press