NEW YORK, June 28 (Reuters) - Japan must commit to strong measures to boost growth so that the economy can withstand higher taxes and tighter fiscal policy in coming years, a senior Japanese government official said on Friday.
“We need to consider (the) risk that the fiscal condition could deteriorate if the economy is not robust enough to absorb the negative impact of tax increases,” said Vice Economics Minister Yasutoshi Nishimura in a speech at the Japan Society in New York. “So we’ll implement a growth strategy to make the economy resilient to any shocks.”
Prime Minister Shinzo Abe’s government intends to implement comprehensive tax reform, including an increase in the consumption tax, over the next two years. The government wants to cut Japan’s deficit in half by 2015 and achieve a surplus by 2020.