LDP Begins Discussions on Consumption Tax Cut Plan

Tokyo, Aug. 25 (Jiji Press)--The tax panel of Japan’s ruling Liberal Democratic Party held an informal executive meeting on Tuesday to begin discussions on details of a planned two-year cut in the consumption tax rate on food starting in April.

On Aug. 5, the government adopted a plan to lower the consumption tax rate on food from 8 pct to 1 pct. Middle- and low-income earners will receive benefits equivalent to the remaining 1 pct.

The LDP’s Research Commission on the Tax System is considering a temporary exemption from the requirement to display tax-inclusive prices, a relief that would apply to businesses unable to replace their price tags in time for the tax cut.

The commission is also considering having the current 8 pct tax rate applied to mail-order sales and other transactions concluded before the tax rate change.

The panel will consult with its counterpart from the Japan Innovation Party, the LDP’s coalition partner, to compile a tax system reform package by mid-September. The government plans to submit a related bill to parliament this autumn.

[Copyright The Jiji Press, Ltd.]