world-economy

Japan to Cut Food Sales Tax to 1% Starting April

Prime Minister Sanae Takaichi is moving forward with a temporary reduction of the sales tax on food and soft drinks to 1%. The initiative represents a significant policy shift after extended political gridlock and addresses a core campaign commitment. The measure comes as Japan confronts economic headwinds, including downward revisions to growth forecasts tied to elevated oil prices stemming from Middle East tensions. Officials hope the tax reduction will ease cost-of-living pressures on consumers while supporting domestic demand. The temporary nature of the cut suggests policymakers are balancing fiscal constraints with immediate relief for households facing inflation in essential food categories.