A bill to cut the consumption tax on food and drink cleared the lower house Financial Affairs Committee on the 6th, passed by a majority of the ruling parties. It was scheduled for an emergency vote on the floor of the lower house the same day, where it was expected to pass by a majority and be sent to the upper house.
The bill centers on lowering the consumption tax rate on food and drink from 8% to 1%, and on a new income-linked cash benefit program. The cut is limited to two years starting in April 2027 and is positioned as the centerpiece of measures against rising prices.
The benefit, framed as support for middle-income earners, would be introduced first in fiscal 2027 and 2028, funded by about ¥600 billion a year — the equivalent of one percentage point of consumption tax revenue — to bring the tax burden to "effectively zero." The program would be expanded from fiscal 2029.
Opposition parties have not softened their opposition to the bill, calling its content opaque, while the ruling parties pushed for lower house passage on the 6th. The opposition holds a majority on a special committee set up in the upper house for the bill, and the ruling parties have been working to line up a majority there.