On October 1, DPJ President Banri Kaieda issued the following statement after the Cabinet approved the proposal to raise the consumption tax to 8% from April 1 next year.

Today, the proposal to raise the consumption tax to 8% from April 1 next year, in accordance with the provisions of the comprehensive tax system reform law, was approved by the Cabinet.

We believe that the consumption tax rate increase that has been pursued by the DPJ, the LDP and New Komeito is the embodiment of “the comprehensive reform of social security and tax”. This comprehensive reform has been promoted as a response to the extreme drop in the birthrate and ageing of society and the critical state of public finances, with the aim of establishing a sustainable social security system for all generations, and creating sound public finances.

Therefore, we find it totally unforgivable that the objective of transforming the consumption tax into a source of funding for social security should be ignored, and the consumption tax revenues used in practice for unnecessary and non-urgent public works projects and the like. This will never be accepted by the public.

Reform of the social security system, including the enhancement of social security, must be pursed in tandem with comprehensive tax system reform. It is extremely regrettable that the government is still failing to demonstrate such a total vision, and is first initiating discussion of benefit cuts and increasing the social security burden. The government and ruling parties must act in good faith in order to fulfill the promises made to the Japanese people.
As well as taking measures to combat regressiveness, raising the consumption tax requires implementation of economic and livelihood measures that filter down to household budgets, such as those directed toward employment, housing and automobiles. What is needed is to proceed with the policies proposed by the DPJ’s tax research committee and finance subcommittee.

Bringing forward the date for abolishing the reconstruction surtax on corporation tax runs counter to the spirit of communal ties and cooperation through which the Japanese people as a nation vowed to carry out recovery from the unprecedented disaster of the Great East Japan Earthquake, and we cannot agree to it.

Moreover, we cannot ignore the fact that reforms which require self-sacrifice, including administration and fiscal reforms such as the reduction in the number of Diet members, have made no progress and are being delayed.
The DPJ, as a party with experience of governing the nation, intends to question the government’s stance regarding these issues through debate in the Diet, as well as actively engaging in finding solutions.