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Economy

Japan's consumption tax should be raised to 15%: IMF official

Social security cuts also needed to curb unsustainable debt

Japan must not offer softer tax rates for food and other goods and must cut social security spending, an IMF official said.
Japan should cut social security spending and avoid softer tax rates for food as the population ages, says an International Monetary Fund official studying the country's fiscal health.   © Reuters

TOKYO -- Japan needs to lift the consumption tax rate to 15% and reform its health care and pension systems to restore fiscal health as the nation's aging population spurs more social security spending, an International Monetary Fund official told Nikkei.

The country's public debt load -- roughly double the gross domestic product -- is unsustainable, said Paul Cashin, who leads the delegation for the IMF's annual inspection of Japan's economy.

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