TOKYO (Reuters) – Japan’s government will not include new tax hikes, except for a planned increase in the sales tax in April 2017, in its fiscal reform plan due as early as June, the Asahi newspaper reported on Friday.
Prime Minister Shinzo Abe has pledged to map out a plan to restore Japan’s tattered finances, after delaying a scheduled sales tax hike to 10 percent from 8 percent by 18 months to April 2017.
The fiscal reform plan will lay out how the government intends to achieve its target of turning Japan’s primary budget deficit into a surplus by fiscal 2020.
The new fiscal reform plan will rely on cuts in social welfare spending and an expected increase in tax revenues from expanding economic growth, rather than tax hikes, to hit the target, Asahi said without citing sources.
Any such plans, however, may be insufficient to cut Japan’s public debt which, at double the size of its economy, is the biggest among major industrialized nations.
(Reporting by Leika Kihara; Editing by Eric Meijer)