November 14, 2025

Japanese Communist Party Secretariat Head Koike Akira, at a meeting of the House of Councillors Budget Committee on November 13, referred to Prime Minister Takaichi Sanae’s statement that she would reduce the consumption tax rate if permanent revenue sources were available. Koike said to PM Takaichi, “Let’s make it happen!”

During the House of Representatives Budget Committee meeting on November 11, PM Takaichi was asked by a Komei Party lawmaker what she would do if she had a permanent budget of five trillion yen at her disposal each year. She replied, “Right now, for example, I would make the reduced consumption tax rate of 8% on food items 0% forever.”

Expressing his agreement with the prime minister’s view, Koike stated that the JCP is proposing a cut in the consumption tax rate to 5% as an immediate measure.

In order to secure the permanent funding source necessary to reduce the consumption tax rate, the JCP proposes the following methods: revising the corporate tax breaks which amount to eleven trillion yen annually, which the government itself admits have “failed to achieve the intended effect,” and abolishing the “100 million yen barrier” in which the tax burden rate decreases for annual incomes exceeding 100 million yen.

Koike called on PM Takaichi to create permanent fiscal resources by ensuring that large corporations and the rich bear their fair share of the tax burden.

PM Takaichi, however, expressed concern that higher corporate tax rates could drive companies out of Japan, adding, “I would be pleased if you could propose an alternative.” In response, Koike pointed out that during the LDP presidential election campaign four years ago, Takaichi had proposed “abolishing special tax measures for corporations” and “raising the corporate tax rate.”

Koike emphasized that a consumption tax cut will certainly stimulate consumer spending, and accordingly this will have a positive impact on corporate management. He stated, “Let’s have thorough discussions in the Diet,” regarding how to secure the necessary funds for tax cuts.