Japan sales tax debate in final stage as deadline looms

Japan's government has entered the final stage of debate on doubling the 5 percent sales tax to pay for welfare costs, a welcome step towards fiscal consolidation that would still require further tax hikes and spending cuts to lower public debt. Any delay in the sales tax proposal could draw the ire of ratings agencies, which earlier this year threatened Japan with downgrades. The government has set itself a year-end deadline to flesh out a plan originally floated in June to reform welfare spending. Some of the details that have emerged so far, such as linking pension payments to Japan's falling consumer prices, would take some pressure off state coffers. (Reuters)