Recently the Yomiuri News reported the following:
On the 2nd, the government's "Conference focused on reviewing the social security reform" (chairperson: Prime Minister Gan) made arrangements for the social security reform plan.
The policy to increase pension, medical treatment, nursing, and child-nurturing support was included, and the need to increase consumption tax rate to 10% in phases by the fiscal year 2015 was described clearly.
Based on the reform plan, in order to carry out the expansion, about 2.7 trillion yen additional fiscal resource was necessary for fiscal year 2015 as calculated provisionally. The assumption that consumption tax was regarded as a "Social security special purpose tax" was clearly stated, and it was used to deal with the natural increase etc. in financing the basic pension and the cost of Social Security; "the fiscal resource stability will be ensured" by setting the consumption tax at 10%. It was made known that preparations for tax revision laws would be carried out within the current year.
Recently, the Prime Minister had set up a "Core member conference" of the government and leaders in the ruling party, and finally decided on a "Two-stage tax increase" idea that would increase tax by about 3% in the fiscal year 12, and by further 2% by fiscal year 15. It was regarded as a "Comprehensive tax and social security reform plan", and called for discussion with the opposition party by the end of the month.
To meet social security needs, tax increase in Japan seems unavoidable.