Finance Minister Kiichi Miyazawa said Tuesday that raising Japan's consumption tax rate to around 10 percent, the same level as in European nations, from the current 5 percent is inevitable in order to realize fiscal reconstruction.
"Should we conduct a simulation (of fiscal reconstruction), its answer will quite likely be that the consumption tax must be raised," Miyazawa said, responding to a question by ruling Liberal Democratic Party lawmaker Makiko Tanaka before the House of Representatives Budget Committee.
While spelling out the possibility of raising it to the European level, Miyazawa said the government also needs to introduce multiple tax rates in order to impose a lower rate on daily necessities, such as food.