SDP to oppose bills on bond issuance, tax reform

TOKYO, Feb. 20 Kyodo -
The Social Democratic Party plans to oppose a bill that would enable the issuance of deficit-covering bonds and another bill that would review taxation, a senior lawmaker of the small opposition party said Sunday.
The opposition by the SDP, whose support the ruling Democratic Party of Japan appears to be seeking to ensure the passage of these bills together with other budget-related bills, would put that process at risk as the largest opposition Liberal Democratic Party has already said it plans to oppose the bills.
The fate of the bills is uncertain because the DPJ-led coalition does not control the House of Councillors. The opposition of the SDP would put in jeopardy a plan by the DPJ-led coalition to secure a two-thirds majority in the House of Representatives to override a rejection by the upper chamber.
Tomoko Abe, who chairs the SDP's policy board, said during a televised political debate on NHK, officially known as Japan Broadcasting Corp., that her party will officially decide on its response to these bills in the on-going parliamentary session at Tuesday's meeting of its lawmakers in the both houses. She said the party will convey its decision to the DPJ at the meeting of the secretary generals of the two parties.
Abe said the bond issuance bill ''has a bunch of problems'' and her party cannot agree to it.
''We cannot approve the bill if the bonds to be issued are to fill the hole caused by cutting the corporate tax rate and to extend Japan's contribution to the cost of stationing U.S. troops in Japan for five years,'' she said.
The bill to review taxation includes a cut in an effective corporate tax rate by 5 percentage points.
Abe said about the tax reform bill, ''We do not think cutting the corporate tax rate can be a measure to counter deflation. We think the bill will not pass.''
Abe also made critical remarks about another bill that would extend the child-rearing allowances in the new fiscal year from April.
If the bond issuance bill is voted down, the government will be unable to issue deficit bonds to make up for a 38.2 trillion yen shortfall in the 92.4 trillion yen budget for fiscal 2011.
Under Japan's Constitution, the budget can take effect even if the upper house rejects it. But budget-related bills require either the upper chamber's approval or a two-thirds majority in a lower house revote.