Key Facts
• August 6, 2025: Policy chiefs of ruling and opposition parties held discussions.
• Focus: Combining income tax deductions with cash benefits under a “tax credit with benefits.”
• Liberal Democratic Party (LDP) policy chief Onodera emphasized the importance of broad discussions.
• The proposal was a key policy of the Constitutional Democratic Party (CDP) during the Upper House election.
• Prime Minister Ishiba instructed party leaders to exchange views, leading to the meeting.
• Onodera acknowledged the proposal’s rational aspects but noted challenges in system design.
• No internal party discussions or decisions have been made on the proposal.
• CDP also proposed zero consumption tax on food and a ¥20,000 cash benefit per person.
• Government plans to submit a supplementary budget in the autumn session, including ¥20,000 cash benefits.
• LDP leaders expressed skepticism, citing public rejection of cash benefit policies.
Summary
The Liberal Democratic Party (LDP) and the Constitutional Democratic Party (CDP) held discussions on August 6, 2025, focusing on inflation countermeasures, including a “tax credit with benefits” policy. This proposal, combining income tax deductions with cash benefits, was a key CDP policy during the Upper House election. Prime Minister Ishiba initiated the meeting, instructing party leaders to exchange views. While LDP policy chief Onodera acknowledged the proposal’s rationality, he highlighted challenges in its system design and confirmed no decisions have been made. Additional topics included the CDP’s proposal for zero consumption tax on food and a ¥20,000 cash benefit per person. The government plans to include cash benefits in the autumn supplementary budget, but skepticism remains among LDP leaders, who believe the public has rejected such measures. Discussions between the parties are set to continue.
