Key Facts
• August 6: Second working-level meeting held by six ruling and opposition parties.
• Proposal to abolish the provisional gasoline tax rate, reducing annual tax revenue by ¥1 trillion.
• August 21: Next meeting scheduled to present permanent revenue source proposals.
• Current gasoline subsidy: ¥10 per liter; opposition suggests gradual increase to ¥25.1.
• Government estimates a ¥600 billion shortfall in the fuel price stabilization fund by March 2026.
• Ruling party remains neutral on opposition’s proposal, awaiting comprehensive financial plans.
• Meeting participants: Liberal Democratic Party, Komeito, Constitutional Democratic Party, Japan Innovation Party, Democratic Party for the People, and Japanese Communist Party.
Summary
On August 6, six ruling and opposition parties convened their second working-level meeting to discuss abolishing the provisional gasoline tax rate, which would result in a ¥1 trillion annual revenue loss. Both sides agreed to present concrete proposals for permanent revenue sources at the next meeting on August 21. Discussions also addressed the current gasoline subsidy of ¥10 per liter, with the opposition proposing a gradual increase to ¥25.1 to lower fuel prices. However, government estimates indicate a potential ¥600 billion shortfall in the fuel price stabilization fund by March 2026 if subsidies are expanded to other fuels like diesel and kerosene. While the ruling party has not endorsed the opposition’s plan, it remains open to discussions contingent on comprehensive financial strategies. The meeting included representatives from six major political parties, highlighting bipartisan efforts to address the issue.
