Prime Minister Shinzo Abe's decision to postpone the second stage of the sales tax hike is likely to wreak havoc on health care provisions for the elderly.
Abe last week delayed plans to raise the sales tax to 10 percent from 8 percent until April 2017 after GDP data released last week showed that the world's third-largest economy had contracted 1.6 percent in the third quarter, tipping the country back into recession.
The government had expected to reap an additional ¥14 trillion in annual revenue by doubling the consumption tax to 10 percent by October 2015 in two stages, beginning with a hike to 8 percent in April. The funding was aimed partly at covering reforms that would boost home-based care for the elderly, provide extra support for working mothers and cover the country's burgeoning pension and health care costs.
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