To address Japan's income gap, Prime Minister Fumio Kishida stated that he will prioritise raising salaries through tax incentives rather than imposing higher levies on capital gains and dividends.
Prime Minister Kishida declared that putting the economy on a stable basis with bold monetary easing, flexible fiscal initiatives, and a growth strategy will be a near-term priority.
When questioned by an opposition lawmaker about his prior proposal to hike capital gains tax, Kishida said, "It's among possibilities to create a virtuous cycle of growth and redistribution."
"But there are other things we need to accomplish first," Kishida said, stressing the need to reform the tax system in order to achieve salary increases.
He stated that the government would begin by overhauling corporate tax to assist companies who want to raise wages.
Former Prime Minister Shin Abe's "Abenomics" stimulus programmes, according to Kishida, stimulated growth, rescued Japan from deflation, and created jobs.
"Now we'll take a variety of steps to redistribute wealth," Kishida stated. "It's critical that we take these actions in the right order."
Kishida, who has made wealth redistribution a top priority, previously stated that modifying capital gains and dividend taxes would be one of the options.
On Sunday, however, he backtracked on that promise, stating he would not modify the tax on investment income for the time being, a decision that some experts believe reflects his concern about shaky stock markets.