February 6, 2023
TOKYO – Discord has grown within the government and ruling parties over issues such as financial sources for defense spending, measures for the declining birth rate and adjustments in fielding candidates.
The lack of harmony is due to the absence of “coordinators” whose role is to gather opinions in advance on important policy issues and exercise authority within the government and ruling camp, making it likely Prime Minister Fumio Kishida will continue facing difficulties in reaching consensus.
Funding for defense
“We will seek to be allowed to raise corporate tax and cigarette tax rates, but income tax and the financial burden on most small and medium-size enterprises will not go up,” said Toshimitsu Motegi, secretary general of the ruling Liberal Democratic Party, on an NHK program aired Jan. 29.
By saying this, he sought understanding for the government’s policy of securing approximately ¥1 trillion as part of additional financial resources for the increase in defense outlays from fiscal 2027 onward to strengthen defense capabilities through tax hikes.
Regarding the policy of raising taxes to fund the envisaged increases in defense spending, strong opposition, mainly from members of the Abe faction, runs through the special mission committee led by Koichi Hagiuda, chairman of the LDP’s Policy Research Council. Hagiuda and Hiroshige Seko, secretary general for the LDP in the House of Councillors, both of whom belong to the Abe faction, have made it clear that they are reluctant to raise taxes.
Seko said on a TV program aired on Jan. 23, “If things go well, we will also try to find a way without a tax increase.” Meanwhile, Hagiuda is also aiming to realize a plan to raise funds through a review of the rules for redeeming government bonds. Although Chief Cabinet Secretary Hirokazu Matsuno and Finance Minister Shunichi Suzuki have denied the possibility of reviewing the rules, Hagiuda has indicated his eagerness to those around him, saying, “I want to somehow get the government to agree to it.”
It is believed that both Hagiuda and Seko aim to weaken the image of the party as one that raises taxes before the nationwide local elections, but there is also concern that the discord within the party might be taken advantage of by opposition parties that oppose the tax hike. There are complaints within the government that “it seems as if the Abe faction and opposition parties stay in step with each other.”
Tackling declining birth rate
When it comes to the measures to cope with the declining birth rate, Motegi said during a House of Representatives interpellation on Jan. 25 that the income limit for parents to receive child allowances should be abolished. His remark has created a somewhat strange atmosphere within the LDP, because it was made without going through a discussion at the policy council, which collates the party’s policy. Hagiuda told reporters on Jan. 28, “It is well worth considering,” but he also made it clear that “the party has not solidly decided on a course of action yet.”
Motegi reiterated on the same NHK program on Jan. 29 that the limit “should be abolished.” When asked about consistency with the party’s previous stance of calling for an income limit, he said, “We will reflect on it,” but added: “Now is the very last moment to stop the declining birth rate. We will not proceed with a debate premised on a tax hike,” calling on the opposition parties to cooperate.
Differences have also surfaced within the ruling parties, namely between the LDP and Komeito.
Komeito announced Jan. 25 that it will field incumbents in Hiroshima Constituency No. 3 and Tokyo Constituency No. 29 in the next lower house election. But it has not yet discussed the matter with the LDP’s local organizations, and opposition within the LDP is spreading. On Jan. 27, Komeito leader Natsuo Yamaguchi said: “It is important [for a party] to decide [on its candidates] as early as possible. We will make our decisions under our own initiative,” laying bare the weak ties between the LDP and Komeito at the moment.