Prime Minister Shinzo Abe has announced he will postpone the consumption tax increase that had been scheduled for April next year to October 2019.
Abe said at a news conference on Wednesday that the global economy is changing at a speed beyond imagination and uncertainty over it is growing.
He said the situation is similar to the 2008 global financial crisis. He pointed out prices of crude oil and other commodities have plunged, and investment has dropped, hurting emerging and developing economies significantly.
Abe explained that he decided to postpone the tax hike as it could stifle domestic demand and lead to a crisis.
Abe noted that when he dissolved the Lower House a year and a half ago, he declared that there would be no more tax hike delays.
He said he will seek voter judgment on his new decision in the Upper House election to be held on July 10th.
He said the ruling bloc aims to win a majority of the 121 seats up for reelection.
Source: NHK Image: Bank Image