Japan Sales Tax Increase Plan Triggers Some Concern in IMF

Japan’s plan to double a sales tax by 2015 to improve its finances has triggered some concern within the International Monetary Fund’s board.

While IMF directors “generally” supported the plan, “a few” expressed concern over a possible hit to growth, the fund said today in a statement summarizing the view of its executive board. The term “a few” is used by the IMF to mean between two and four. It urged the country to gradually increase the levy to “at least 15 percent” to bring down its public debt over the medium term, according the IMF’s staff report of its annual review of Japan.