The ruling Liberal Democratic Party’s General Council unanimously approved Prime
Minister Sanae Takaichi’s large-scale food consumption tax cut, clearing the way
for cabinet approval later Wednesday; implementation is slated to begin April
2027 after review in a special Diet session. The plan cuts the food consumption
tax rate from 8% to 1% over two years and adds a further 1% rebate/subsidy,
effectively creating a zero tax burden on food purchases. The measure is
expected to create about ¥5 tln (~$31.7 bln) in fiscal revenue shortfall,
increasing pressure to identify funding sources.
