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August 11, 2026
 

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CONSUMPTION TAX

Despite months of debate, Prime Minister Sanae Takaichi failed to gain consensus within the Liberal Democratic Party on a two-year reduction of the consumption tax.
JAPAN / Politics / ANALYSIS
Aug 7, 2026
Will Takaichi¡¯s consumption tax cut break the LDP?
Debate on the consumption tax debate has become a test of party cohesion for the LDP under the prime minister¡¯s leadership.
A restaurant in Tokyo in August 2024. Restaurant operators are poised to expand take-home meals to cope with a wider tax gap between eat-in meals and takeout foods.
BUSINESS
Aug 6, 2026
Japanese businesses brace for tax cut
Restaurant operators are poised to expand take-home meals, such as bento boxed meals and other precooked dishes, to cope with a wider tax gap between eat-in meals and takeout.
The effort to cut consumption tax on food has created a rift between Prime Minister Sanae Takaichi and several senior members of her own party who are openly critical of the plan.
JAPAN / Politics
Aug 5, 2026
Takaichi¡¯s Cabinet approves consumption tax cut on food
While the majority of the Liberal Democratic Party endorsed the cut, some party veterans opposed lowering the tax rate, fearing it will lead to economic and political chaos.
Members of the Liberal Democratic Party's tax and social security panels hold a meeting on Monday to discuss a consumption tax cut.
JAPAN / Politics
Aug 3, 2026
LDP members worry about two-year tax cut¡¯s impact on 2028 poll
Under the plan, the consumption tax rate on food will be lowered to 1% for two years from next April.
Yuichiro Tamaki, leader of the opposition Democratic Party for the People, speaks at a meeting with supporters in the city of Wakayama on Saturday.
JAPAN / Politics
Aug 3, 2026
Opposition DPP not to join ruling bloc for now, citing consumption tax cut
Some in the LDP sought to realize the DPP¡¯s participation before an extraordinary session of parliament is convened possibly this autumn.
Prime Minister Sanae Takaichi announces a plan to lower the consumption tax rate on food items at the Prime Minister's Office in Tokyo on July 30.
JAPAN / Politics
Aug 2, 2026
Â鶹´«Ã½ politically sensitive consumption tax faces first-ever cut
Takaichi has championed a proposal to lower the tax rate on food purchased at stores, which would mark the first cut to the rate since it was implemented in 1989.
Prime Minister Sanae Takaichi attends a meeting with Liberal Democratic Party executives at the party's headquarters in Tokyo on Thursday.
JAPAN / Politics
Jul 30, 2026
Takaichi announces plan to lower consumption tax rate on food to 1%
The decision comes despite opposition party criticism and concerns among fellow LDP members about how lost revenue ¡ª ?5 trillion annually ¡ª from the reduction would be covered.
With the parliamentary session over, Prime Minister Sanae Takaichi now finds herself under pressure to do something about the rising cost of living.
JAPAN / Politics / ANALYSIS
Jul 30, 2026
Takaichi¡¯s popularity slide exposes deeper governing challenges
Prime Minister Sanae Takaichi¡¯s drop raises the question of whether it is from the normal growing pains of a new administration or if it indicates deeper structural problems.
Liberal Democratic Party lawmaker Itsunori Onodera, who chairs the National Council, speaks in Tokyo on Wednesday.
JAPAN / Politics
Jul 29, 2026
Takaichi finalizing plan to cut consumption tax rate on food products
The prime minister is expected to make a formal decision on the matter as early as Thursday.
Prime Minister Sanae Takaichi speaks during a budget committee session at the Lower House in Tokyo on Monday.
JAPAN / Politics / FOCUS
Jul 27, 2026
After a legislative sweep, Takaichi faces public confidence test
A recent poll shows 71% of respondents disapproved of the government¡¯s response to rising living costs as talks remain stalled over a reduction of the consumption tax for food.
LDP lawmaker Itsunori Onodera (right), who chairs the National Council on Social Security, in Tokyo on Thursday
JAPAN / Politics
Jul 16, 2026
Parties agree on new benefit program but stay divided over consumption tax on food
While there is agreement to a refundable tax credit for certain workers, debate on cutting the consumption tax on food is expected to intensify.
After the suprapartisan National Conference on Social Security working-level meeting, Itsunori Onodera (left), chairperson of the LDP¡¯s Research Commission on the Tax System, speaks to reporters at the Diet building on Monday.
BUSINESS
Jul 14, 2026
Japan National Council chief modifies draft of new benefit program
The revision proposes concrete support measures, including benefit payments to low-income earners and people who cannot work due to diseases or disabilities, in fiscal 2029.
Prime Minister Sanae Takaichi speaks during a meeting on economic policy at the Prime Minister's Office in Tokyo on Thursday.
JAPAN / Politics
Jun 27, 2026
Japan government to avoid deficit-covering bonds for food tax cut
The move to avoid the issuance of deficit-covering bonds follows a policy that Prime Minister Sanae Takaichi has consistently emphasized.
A draft by a tax panel calls for reducing the consumption tax rate to 1% for food for two years from April 2027.
BUSINESS / Economy
Jun 25, 2026
Interim draft on two-year food tax cut presented
The proposal calls for reducing the tax rate to 1% for food for two years from April 2027.
Prime Minister Sanae Takaichi at a Lower House budget committee session on Monday
JAPAN / Politics
Jun 22, 2026
Takaichi says consumption tax cut would last only two years
Asked if the cut would expire after two years even if the economy worsened, the prime minister said the measure is only ¡°a bridge¡± until a refundable tax credit program is created.
The nonpartisan National Council discusses a consumption tax reduction in Tokyo on Wednesday.
JAPAN / Politics
Jun 18, 2026
Takaichi acknowledges proposed cut of consumption tax on food to 1%
The plan has divided party members and raised concerns about its impact on financial markets.
The ruling Liberal Democratic Party pledged during February¡¯s general election campaign to speed up discussions on suspending the tax on food for two years.
BUSINESS / Economy
Jun 16, 2026
LDP still considering cutting sales tax to zero for food
The ruling party pledged during February¡¯s general election campaign to speed up discussions on suspending the tax on food for two years with a view to going ahead with it.
A consumption tax cut on groceries is intended to help households struggling to make ends meet.
BUSINESS / Economy
Jun 12, 2026
Consumption tax cut on groceries could do more harm than good
It could lead to less confidence in Â鶹´«Ã½ fiscal state, a weaker yen, higher rates and slower economic growth.
Since adjusting cash register systems for a 1% tax rate would take less time than for zero percent, implementing 1% next April is gaining support within the government and ruling parties.
JAPAN / Politics
Jun 7, 2026
Final decision on tax cut left to PM Takaichi: LDP exec
Since adjusting cash register systems for a 1% tax rate would take less time than for zero percent, implementing 1% next April is gaining support.
Prime Minister Sanae Takaichi during a party leaders' debate at the Lower House of parliament in Tokyo on May 20. A pledge to cut the consumption tax on food products is quickly becoming a policy headache for the prime minister.
JAPAN / Politics / ANALYSIS
Jun 4, 2026
Consumption tax cut is quickly turning into a headache for Takaichi
Translating the pledge from Prime Minister Sanae Takaichi¡¯s administration into policy has proven more complicated than many lawmakers anticipated.
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