TORONTO -(Dow Jones)- Japanese Prime Minister Naoto Kan Saturday distanced himself further from a controversial idea to raise Japan's sales tax rate to help reduce the country's debt, saying he's only asking for cross-party debate on tax issues.
"My proposal only goes as far as inviting" other parties to discuss tax issues with the ruling Democratic Party of Japan, Kan told reporters after attending a meeting of the leaders of the Group of Eight industrialized countries.
Public support for lifting Japan's currently 5% consumption tax rate has wavered, with some polls suggesting that voters understand the need for a tax hike to fix the country's fiscal health, but other surveys indicating that when actual numbers for the tax raise are brought up, the idea becomes less popular.
Kan, who took office on June 8, has said he would use the opposition Liberal Democratic Party's proposal for a doubling of the tax rate to 10% "as a reference", without committing himself to lifting the tax to that level.
The prime minister repeated Saturday that he's only calling for cross-party discussions on overhauling Japan's tax policy soon after Upper House elections on July 11 wrap up.
Other political parties including the LDP have appeared reluctant to take part in Kan's proposed tax discussions, with some saying raising the regressive tax would hurt the poor.
Turning to the July Upper House elections, Kan repeated that he's aiming for more than 54 victories for the DPJ, which he leads. The number of DPJ seats that will be contested is 54, but the party needs to win 60 seats to get an outright majority that won't require it to form a coalition.
Polls over the weekend predicted that the DPJ would keep around 54 seats in the Upper House, but that it might struggle to find a coalition partner with which to form a majority.
Copyright 2009 Dow Jones Newswires
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