The Liberal Democratic Party and its junior coalition partner, Komeito, have agreed to postpone a decision on when to raise income tax rates to secure funding for higher defense expenditures, Yoichi Miyazawa, chair of the LDP's tax panel, said Friday.
As for defense spending-linked hikes of corporate and tobacco taxes, the ruling parties are set to include a plan to start implementing them in April 2026 in their outline for the fiscal 2025 tax system reform.
The two parties' tax system research commissions initially aimed to raise corporate and tobacco taxes in April 2026 and income tax rates in January 2027, and had hoped to include both measures in the tax system reform package for fiscal 2025.
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