TOKYO, May 30: Japanese Prime Minister Shinzo Abe said he would delay a sales tax hike scheduled for next April by two and a half years, a senior ruling party official said after a meeting with the premier on Monday. “The premier’s determination to postpone the tax increase seems to be very strong,” Masahiko Komura, vice president of the ruling Liberal Democratic Party, told reporters. Komura’s comments confirm what sources had told Reuters on Sunday as Abe looks to avoid dealing a hammer blow to a fragile economic recovery, with the announcement on the tax decision expected ahead of an upper house election expected in July. But Finance Minister Taro Aso has voiced opposition, saying that Abe should dissolve the lower house of parliament and call a snap election if he were to postpone the tax hike. Toshiro Nikai, another senior LDP official who met Abe on Monday, said the premier did not appear to have any plan to call a snap election for the time being. Abe is meeting senior LDP and coalition party officials on Monday to gain consent for his plan to delay the tax increase. He is expected to formally announce the tax hike delay by the end of the current session of parliament on Wednesday, government officials have told Reuters. The prime minister is also expected to order an extra budget to fund stimulus measures, just two months into the fiscal year and on the heels of a supplementary budget to fund rebuilding efforts after the recent earthquakes in southern Japan. Consumption has yet to recover after Japan fell into recession when Abe raised the sales tax to 8 percent from 5 percent in April 2014 in an effort to curb government debt. Abe has long said he would proceed with a plan to raise the tax rate to 10 percent next April unless Japan faced a crisis on the magnitude of the Lehman shock. (AGENCIES)
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