Japan

The Mainichi | English | News | Jan. 23, 2026 | UndeterminedTaxes

Japanese Prime Minister Sanae Takaichi announced on January 19, 2026, that the ruling Liberal Democratic Party will propose eliminating the consumption tax on food and beverages for two years in the upcoming House of Representatives election campaign. This measure aims to ease the financial burden on middle- and low-income earners amid persistently high food inflation.

Takaichi plans to fund the tax cut by reallocating existing subsidies, special tax measures, and non-tax revenue rather than issuing deficit-financing bonds. She emphasized the need to consider impacts on financial markets, including interest rates, exchange rates, and local government finances. The timing of the tax cut was not discussed during the press conference despite prior speculation about a potential reduction around September.

The tax reduction is expected to cause an annual revenue loss of about 5 trillion yen ($31.6 billion), with roughly 2 trillion yen ($12.6 billion) impacting local governments. This has raised concerns about fiscal deterioration, reflected in rising government bond yields and potential yen depreciation, which could further increase inflation through higher import costs.

The opposition Centrist Reform Alliance advocates for a permanent zero consumption tax on food and beverages, making tax reduction a realistic prospect regardless of the election outcome. However, some economic officials warn that continued fiscal loosening by both major parties risks long-term fiscal collapse.

3/17、2026年版九州経済白書説明会「食･農の未来」【久留米会場】

Kyushu Economic Research Center | Local Language | AcademicThink | Jan. 23, 2026 | UndeterminedEconomic Growth

On March 17, 2026, a briefing session titled "The Future of Food and Agriculture" was held in Kurume City, focusing on the challenges and prospects for Kyushu's agricultural sector. The session addressed issues such as the decline and aging of the agricultural workforce, increasing abandoned farmland, and unstable yields due to climate change-related factors like abnormal weather and natural disasters. The briefing aimed to discuss strategies for enhancing agriculture's appeal, maintaining and strengthening production bases—including people, land, and technology—and adapting to changing consumer demands.

The 2026 Kyushu Economic White Paper was the basis for the briefing, covering topics such as food security, current production and distribution challenges, structural changes in Kyushu agriculture, labor securing in local communities, changes in food distribution, and environmental responses related to food production. The event was held at the Chikugin Bank Head Office with a capacity of 60 participants, free of charge, and featured Hideyuki Okano, Executive Managing Director of the Kyushu Economic Research Association, as the presenter.

Participants were encouraged to purchase the 2026 White Paper at the venue for a discounted price to enhance their understanding. The event was organized by Chikugin Bank, the Chikugin Regional Economic Research Institute, the Kurume Chamber of Commerce and Industry, and the Kyushu Economic Research Association. Attendees were advised there was no parking available and entry was on a first-come, first-served basis without issued admission tickets.

Nippon | English | News | Jan. 23, 2026 | Geopolitical Conflict and Disputes

Japan's Chief Cabinet Secretary Minoru Kihara described alleged espionage involving a former employee of Russia's trade representation in Japan as "regrettable." The individual was referred to Japanese prosecutors on suspicion of illegally obtaining trade secrets from a Japanese machine tool manufacturer, in violation of the unfair competition prevention law.

The Foreign Ministry communicated Japan's position on the incident to Russia. Kihara emphasized the importance of strictly addressing foreign agency activities to protect national interests and the safety of Japanese citizens. He also highlighted the need to enact legislation against espionage, as outlined in the coalition agreement between the ruling Liberal Democratic Party and the Japan Innovation Party.