Accusations Grow That Tax Relief Is Being Dodged as the Takachi Cabinet Is Criticized for Delaying Tough Decisions

Is there something they don’t want recorded in the official minutes?

On February 26, Prime Minister Sanae Takaichi (64) held the first meeting of the “National Social Security Council” at the Prime Minister’s Office to discuss the design of systems such as consumption tax cuts and refundable tax credits. Takaichi stated, “We want to ease the burden on low- and middle-income earners suffering from taxes, social insurance premiums, and rising prices. We aim to submit the necessary legislation to the Diet as soon as possible.”

However, the leading and second-largest opposition parties—the Centrist Reform Alliance (hereafter “Centrist”) and the Democratic Party for the People—announced they would not participate.

Meanwhile, parties such as Sanseito, the Japanese Communist Party, and Reiwa Shinsengumi were not invited due to differing views on the consumption tax. As a result, despite being labeled a “national” council, only three parties participated: the Liberal Democratic Party, Nippon Ishin no Kai, and Team Mirai.

On the 24th, during the Diet session for questions from party leaders following Takaichi’s policy speech, Junya Ogawa (54), the new leader of the Centrist alliance, questioned the very necessity of establishing the “National Council”:

“Isn’t it standard practice for the ruling parties themselves to organize the issues, present them openly to the Diet, and debate them in a fully transparent setting? Why, now, on matters like consumption tax cuts, is a national council needed? Please explain the intent. If it is merely a performance or a way to shift responsibility, we cannot support it.”

Since this is a policy consultation body, the government and ruling parties argue that it is not a discussion from scratch, but rather a forum inviting opposition parties that support implementing refundable tax credits. While that explanation is not entirely unreasonable, it remains questionable that some political parties are excluded despite the council being labeled national.

“A special committee could be set up within the Financial Affairs Committee, allowing discussions to take place in the Diet where all parties can participate. Excluding officially elected parties from deliberations is also strange—one has to wonder if there is something they don’t want recorded in the Diet minutes,” said political journalist Koichi Kakutani.

For the sake of creating an alibi?

This “National Council” was originally proposed by Takaichi in her policy speech last October as a bipartisan forum with experts to discuss social security reform. At a New Year’s press conference on January 5, she even stated that it would be established within the month.

However, due to the sudden dissolution of the Diet and the general election, its launch was delayed. What was supposed to be a forum to discuss social security reform has now shifted—both in timing and substance—into something that will consider whether to make food items tax-free within the council, with its purpose changing repeatedly.

The Takaichi administration aims to compile an interim report by early summer, but both the Centrist alliance and the Democratic Party for the People have declined to attend the first meeting. Although mid-process participation appears to be allowed, it’s hard to deny that the council has effectively gotten off to a premature start.

“While the first meeting of the National Council is being held, opposition parties are being divided into those who can participate and those who cannot. Among the opposition, only Team Mirai is participating. That party, in the recent general election, advocated maintaining the consumption tax rate and cutting social security spending, winning 11 seats.

Within the Liberal Democratic Party, the prevailing view is already ‘do not lower the consumption tax.’ In that case, isn’t the conclusion already decided?

For Takaichi, it may be enough to strike the pose of ‘I established a National Council for the people.’ Even if the conclusion after discussions is to maintain the tax rate, perhaps she simply wants the council to endorse the idea that while prices are high, cutting the consumption tax was not the best solution,” said Kakutani (aforementioned).

In the current Diet session, there is also ongoing conflict over whether the new fiscal year budget can be passed by the end of March. Takaichi has called on the opposition for cooperation in swift deliberations, expressing her intention to pass the FY2026 budget and other necessary bills within the current fiscal year.

However, the roughly one-month delay in budget deliberations is due to the winter dissolution and election carried out by Takaichi herself.

“Despite being a record-high budget of 122 trillion yen, they are trying to shorten the schedule and pass it by cutting deliberation time.

Defense spending has reached a record level, exceeding 9 trillion yen for the first time. The government plans to revise the three national security documents and review operational guidelines for the Three Principles on Defense Equipment Transfers, submitting a bill to abolish the five categories.

How will they secure stable, permanent funding for the expanding defense budget? If defense equipment with lethal capabilities is to be exported overseas, proper Diet deliberation is necessary, along with careful explanations to the public. Yet there is a push for swift legislation. While the election resulted in a historic victory for the LDP, the public did not hand over a blank check,” said a political reporter from a national newspaper.

On February 18, when the second Takaichi Cabinet was launched, she smiled and declared, “The ‘Takaichi Cabinet 2.0’ has begun.” One can only hope that what “2.0” signifies is not a shortening of deliberation time, exclusion of dissent, or a “National Council” created merely for appearances.