Coalition to steamroll gas tax rate bill April 30

The temporary reprieve at the gas pumps will soon be over.

The government and ruling coalition decided to railroad a bill through the Lower House on April 30 to revive higher gas tax rates, sources said. The move will bypass opposition in the Upper House and set up a possible censure motion against the prime minister.

Ruling coalition officials said the revival of the higher tax rate is needed to prevent revenue shortages in rural areas that lag in development. They estimate that the central and local governments will lose about 2.6 trillion yen in annual revenue through the expiration of temporary road-specific tax rates at the end of March.

A hike in gasoline prices in May appears inevitable.

On Tuesday, Prime Minister Yasuo Fukuda met with Liberal Democratic Party Secretary-General Bunmei Ibuki and Chief Cabinet Secretary Nobutaka Machimura to discuss the matter.

Fukuda told reporters after the meeting that the three agreed that the government cannot give up on rural regions, and that it was necessary to avoid issuing deficit-covering bonds.

However, the opposition camp led by Minshuto (Democratic Party of Japan) looks poised to submit a censure motion against Fukuda. If the motion is passed in the opposition-controlled Upper House, it could lead to further confusion in the Diet.

The Lower House on Feb. 29 passed the government's tax revision-related bill. But debate on the bill has stalled at the Financial Affairs Committee of the Upper House, where the opposition parties hold a collective majority.

The opposition bloc, seeking the abolishment of the higher rates on road-related taxes, forced the temporary gas tax rate to expire at the end of March, leading to a drop in gas prices.

However, under a stipulation in the Constitution known as the 60-day rule, the bill will be viewed as having been voted down in the Upper House unless it is put to a vote by Monday. The government can then opt for a second vote in the Lower House on or after next Tuesday.

Since that day lands on a national holiday, the ruling coalition is expected to convene a plenary session on April 30 and hold a second vote in the Lower House, where the ruling parties hold a comfortable two-thirds majority.

"If the bill is not voted on (in the Upper House) we should enter preparations immediately (for a second Lower House vote)," Tadamori Oshima, chairman of the LDP Diet Affairs Committee, told reporters Tuesday.

Machimura said in a news conference that the outcome of a Lower House by-election Sunday for the No. 2 constituency in Yamaguchi Prefecture would not affect plans to hold the second vote on the gas tax rate.

"Regardless of the outcome of the election, we need to do what is necessary," he said.(IHT/Asahi: April 24,2008)