Is a tax revote a sure thing?

Yamamoto Ichita, who is a far more prolific blogger than I despite (because of?) his membership in the House of Councillors (I’ve just added his blog to the blogroll after linking to him for months), lays out the reasons why the government must use the HR supermajority to reintroduce the temporary tax.

His four reasons are: (1) the government must demonstrate its consistency to the public by following through on its promises, (2) a failure to revote will undermine the government more than a revote will, (3) the end of the temporary tax leaves a hole in the road construction budget, and (4) lowering the gasoline tax weakens Japan’s credibility as a global environmental leader in advance of the July summit.

A successful vote in the HR will likely buy Mr. Fukuda some time, but it will not fix the LDP, not by a long shot. After all, the temporary tax has become a sideshow. The main attraction is the fight within the LDP over Mr. Fukuda’s plan to phase out the road construction special fund and halve the road construction plan to five years. At stake in this fight is nothing short of the LDP’s last shred of reformist credibility, and with it the party’s prospects in the next general election. That fight is far more uncertain, giving the smoldering anger of the doro zoku and the vigor of the reformists (not to mention the DPJ’s implacable opposition). As Yamauchi Koichi, one of the young LDP reformists supporting Mr. Fukuda, notes colorfully, Mr. Fukuda is caught between “the DPJ, the tiger at the front gate, and the doro zoku, the wolf at the back gate.”

The LDP as we know it is in terminal decline, as how the LDP governs appears to be more important to many LDP members than the mere fact of LDP government.

As such, I do not share Jun Okumura’s confidence that Mr. Fukuda has the LDP factions lined up in support of the temporary tax, not to mention the road construction plan. Okumura-san does the math and finds that the prime minister should have no problem lining up the factions behind him — all but three already have — giving the prime minister the support of at least 260 LDP HR members, meaning that he has only to persuade the remaining LDP independents and Komeito to ensure the restoration of the tax. But that assumes that factional discipline is ironclad.

As we saw in Mr. Fukuda’s election as LDP president in September 2007, factional unity cannot be taken for granted, for reasons that even Okumura-san recognizes. Commenting on the fact of the factions’ holding regular Thursday meetings, he tells us, “That’s useful in maintaining unity within the factions, since their ability to raise money for their members and find them Cabinet appointments has been greatly diminished.” I doubt that meetings are enough to maintain factional unity in the absence of the latter. Given that it will take a mere sixteen nays to derail the tax, the decline in factional unity cannot be written off so easily. It might make all the difference in whether the tax passes — and whether Mr. Fukuda survives to fight another day.

For that reason, I suspect that DPJ is working hard to remind vulnerable LDP members of the political consequences of restoring an onerous tax on consumers.

One thought on “Is a tax revote a sure thing?

  1. There is a debate now that everyone living in Japan is probably tired of hearing about: the \’emergency\’ gasoline tax. The gasoline tax should be raised for several reasons, as stated. Another reason for the gasoline tax is that it is fair. You drive more, thus you must pay more for the use and repair of the roads, bridges, etc. I understand about business that must drive, but they take that cost out of their taxes.A very unfair tax, however, is the Road Tax. Why should I pay the same amount of road tax as another person with the same sized engine when I do not drive as much? That is just less of an incentive for me to go out and buy a bicycle. A gasoline tax is much fairer than the road tax.Raise the tax on gasoline, delete the road tax in its entirety.


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