Economic and fiscal policy minister Akira Amari said Sunday it will be difficult to implement the planned hike in the consumption tax to 10 percent in October 2015 if the previous hike to 8 percent next April causes an economic downturn.
"There will be no following" sales tax hike if the 8 percent hike ends in failure, Amari said on a TV program. Prime Minister Shinzo Abe "has concerns that a failure would prevent the government from touching on the sales tax issue for the next 15 years."
Abe is expected to announce the first stage of the sales tax hike on Tuesday, with the aim of increasing revenues to cover swelling social security costs for Japan's aging population.
Meanwhile, Amari indicated that Tokyo, as the host of the 2020 Summer Olympic Games, will be designated as a special district to promote national strategies, where deregulation will be promoted.
"Taking advantage of hosting the Olympics, environments should be arranged in Tokyo as a major base for business and tourism," he said.