Japan's Prime Minister Reaffirms Tax Cut Plans Amid Fiscal Concerns

Japan's Prime Minister Sanae Takaichi reiterated her commitment to advancing tax cuts during her victory speech, despite fiscal concerns. According to Jin10, her ruling party's significant win in the House of Representatives election on Sunday provides a stronger public mandate for her policies. Takaichi announced plans to swiftly establish a cross-party committee to explore a two-year suspension of the consumption tax on food and beverages, aiming to complete a mid-term assessment by summer. She emphasized that deficit bonds would not be issued to cover the fiscal shortfall resulting from the tax cuts. Estimates suggest this policy could reduce tax revenue by approximately 5 trillion yen annually. Additionally, Takaichi pledged to develop an economic system resilient to exchange rate fluctuations, acknowledging the mixed effects of yen depreciation and stating that the government will closely monitor the foreign exchange market.