Japan PM in touching distance of sales tax hike

Japan's prime minister looked set Tuesday to achieve his long-cherished goal of hiking consumption tax, with senior opposition figures agreeing to a final vote on the divisive issue. Yoshihiko Noda has invested most of his political capital in a plan to double the current five percent sales tax in what many analysts agree is a sensible way for Japan to begin tackling its huge mountain of debt. The main opposition Liberal Democratic Party (LDP) appears ready to line up behind Noda's ill-disciplined Democratic Party of Japan (DPJ) in an upper house vote some time on Wednesday, reports said. The DPJ does not have a majority in the upper chamber. The vote is the final hurdle for a bill that has taken up a huge chunk of his administration's energy as it battles public opposition and a disintegrating party. Advocates of the hike say it will help pay Japan's exploding social security bills as a greying population collides with a shrinking workforce, a situation that has created the worst public debt in the industrialised world. The LDP has flirted with the idea of holding the bill hostage to its demands for Noda to hold a general election that is widely expected to benefit its ousted lawmakers at the expense of the unpopular governing party. But the party's Secretary General Nobuteru Ishihara told reporters: "If the vision is clear, and water is calm, we would support the measure" on Wednesday. However, a threatened no-confidence motion from an array of minor parties -- including defectors from the DPJ -- could still derail the vote if the LDP decides to throw its weight behind the move. The LDP finds itself on the horns of a dilemma as it cannot submit its own no-confidence vote if the smaller parties' bid fails; that would leave it without the leverage to force Noda to go to the polls. But failing to back the consumption tax bill at this late stage would open the party up to accusations of double-dealing and hypocrisy because it originally proposed the hike.