FACTBOX-Policies of Japan govt’s potential ally New Komeito

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July 15 (BestGrowthStock) – New Komeito, Japan’s third-biggest
political party, is seen as a possible coalition partner for
Prime Minister Naoto Kan’s Democratic Party after the ruling bloc
lost its majority in an election for parliament’s upper house.

The Democrats are still in power because they have a majority
in the more powerful lower house, but they need new allies to
help pass bills in the upper chamber and avoid policy deadlock.

The Democrats have 106 seats in the 242-member upper house.
Their current coalition partner People’s New Party has just three
seats while the New Komeito has 19 after Sunday’s election.

New Komeito does not differ much from the DPJ on many issues,
but having partnered the main opposition Liberal Democratic Party
(LDP) until it lost power last year, it could find it hard to
switch sides so quickly.

Following are some facts about New Komeito and its key policy

— New Komeito, with 400,000 party members, is backed by the
lay Buddhist group Soka Gakkai, which traces its roots to the
philosophy of Nichiren, a Buddhist monk who lived in 13th century

— The party was the long-dominant Liberal Democratic Party’s
(LDP) junior coalition partner until they lost power in a general
election last year.

— New Komeito stresses the need for a stronger safety net
and social security system, along with policies to fuel economic
growth and tougher rules to combat political funding scandals.

— It aims to achieve 2 percent real growth and 3-4 percent
nominal growth in three years, boosting domestic demand by wooing
more foreign tourists to Japan and spurring exports by selling
infrastructure projects abroad.

— The party wants close communication between the government
and the Bank of Japan, and for the two to cooperate to achieve
inflation of 1-2 percent in three years.

— It has called for a lower corporate tax.

— It wants an overhaul of taxes including the sales tax to
secure a steady source of funding for pensions, health care and
support for raising children.

— The party has not specified by how much or by when the
sales tax should be raised. It criticised Kan’s proposal to
debate a possible sales tax hike, arguing that he should first
map out how to reform the social security system. New Komeito is
against raising taxes just for the purpose of cutting outstanding
public debt.

— It has called for legislation detailing steps for fiscal
consolidation over the next decade. It wants to stabilise the
debt-to-GDP ratio in the medium term and lower the ratio in the
longer term. It also wants to bring the primary deficit, the
budget balance excluding revenue from bond sales and debt
servicing costs, to a surplus.

— On climate policy, New Komeito has called for a target for
Japan to cut greenhouse gas emissions by more than 25 percent by
2020, and by more than 80 percent by 2050 compared with 1990
levels. It wants a domestic cap-and-trade emissions trading
system in place by 2012 covering large emitters. It will also
consider an environment tax.
(Reporting by Chisa Fujioka; Editing by Michael Watson)

FACTBOX-Policies of Japan govt’s potential ally New Komeito