Despite having been tipped to challenge Abe directly for the top spot, Koike on Tuesday told a local newspaper that she was “100 percent not running for the election,” Reuters reported.
With Abe and Keiko both leaning to the right, the main difference between Koike’s party and the LDP is the consumption tax hike, said Sayuri Shirai, professor at Keio University and former Bank of Japan board member.
However, while Abe has said he would increase taxes, it’s unclear that he will follow up on his word, according to Smith.
“For political reasons, he’s saying that the tax hike will go ahead,” Smith said, adding that he did not believe the prime minister will raise consumption tax as “austerity is not in Shinzo Abe’s lexicon.”
Abe is “saying that he won’t go ahead with the hike if the economy is unable to take it — the precise words that he used the previous two times when he pushed out the tax hike,” Smith added.
The Japanese prime minister previously delayed a sales tax hike twice: in 2014 and 2016. At the June 2016 press conference in which the decision was announced, Abe said the global economy was facing significant risks and noted negative impacts from recent earthquakes, Reuters reported.
He had previously said he would delay increasing the tax only in the event of a massive natural disaster or a 2008-style financial crisis.
