TOKYO - Mr Fumio Kishida, a senior Japanese ruling party official seen as among candidates to become next prime minister, on Monday voiced caution over the idea of cutting the sales tax rate to help the economy weather the hit from the coronavirus pandemic.
"Cutting the tax rate would burden small and midsize companies with additional costs" such as adjusting their cashier systems to adapt to a new tax rate, he said. Mr Kishida said Japan must continue to take fiscal and monetary measures to support the economy, as demand won't bounce back strongly due to the expected prolonged battle with Covid-19.
Japan has raised the sales tax twice under Prime Minister Shinzo Abe's administration as part of efforts to rein in the country's huge debt which, at twice the size of its economy, is the biggest among major advanced economies.