At a press conference after the September 8 cabinet meeting, Japan's finance minister reaffirmed how Tokyo intends to pay for a planned two-year cut in Japan's consumption tax on food and beverages, down to 1% starting next year. The funding stance, he said, has not moved since an August 5 cabinet decision: no reliance on special deficit-financing bonds.
A reporter at the briefing put the annual cost of the cut, including related cash benefits, at roughly ¥5tn; the finance minister did not dispute the figure or offer his own. Instead of new borrowing, he pointed to a zero-based review of tax expenditures, subsidies and non-tax revenue, run inside the cabinet's wider budget-reform push, alongside a goal of steadily lowering Japan's debt-to-GDP ratio while keeping full-year bond issuance, across both the initial and any supplementary budgets, under control.
The finance minister also flagged a structural shift away from what he called Japan's habitual reliance on supplementary budgets, saying future supplementary spending will be limited to measures that are genuinely urgent. He singled out roughly ¥3tn in recent supplementary-budget spending on cost-of-living relief for an overhaul: income-linked cash benefits, plus the food tax cut itself, are meant to take over that bridging role.
On a separate line of questioning, the finance minister addressed the early output of what officials call Japan's version of DOGE. He said that at the request stage, ministries' own proposals to abolish or shrink tax breaks and subsidies involved either minimal revenue loss or breaks with no record of ever being used, and that the finance ministry will not simply wave through those self-assessments. He called the request-stage review only the first step ahead of the tax reform process.
Asked about the yen's recent strength, the finance minister declined to comment on specific levels but said Japan's currency response policy is unchanged since the Japan-US coordinated intervention, and that Tokyo remains in close contact with the US Treasury, whose secretary issued a statement of his own on August 3 alongside the minister's. For bond investors, the through-line of the briefing was consistency of message rather than new numbers: a tax cut funded by spending discipline, not new debt, with the specifics still to be filled in during the future budget-compilation and tax reform process.