Japan’s Ishiba Says Won’t Hit Tax-Free Savings If Elected PM

(Bloomberg) -- Japan’s former Defense Minister Shigeru Ishiba said he won’t slap a levy on tax-free savings plans as he answered questions ahead of a ruling party leadership campaign set to determine the next prime minister.

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“Investment through vehicles such as the new NISA program should rather be encouraged,” Ishiba said Friday, referring to a government tax-free investment program that was expanded this year. “I’m not thinking of impeding this at all, or raising taxes on it.”

Ishiba, a frontrunner in public opinion polls on who should lead the ruling party, was previously reported as saying he wanted to strengthen capital gains tax on investment income. That’s an issue Prime Minister Fumio Kishida encountered problems with at the start of his premiership three years ago, leading to an early climb down.

Japan’s capital gains tax currently stands at around 20%, but the tax-free NISA program allows citizens to invest up to ¥3.6 million ($25,000) a year without a levy.

“I think tax systems have to be fair and impartial to gain the trust of citizens,” said Ishiba, as he appeared to tone down his comments on needing to consider raising the levy on investments.

Ishiba declared his candidacy in the Liberal Democratic Party race last month following Kishida’s decision to step down after his three-year term amid low opinion poll ratings. In his last four tries at the top job, Ishiba has struggled to garner enough support from his fellow lawmakers to win the leadership race despite relatively strong public support.

Many analysts predict a similar outcome for him this time when LDP lawmakers and members vote on Sept. 27.

Other candidates who have raised their hands for the top job include former Environment Minister Shinjiro Koizumi, Digital Minister Kono Taro, and party heavyweight Toshimitsu Motegi.

“This is the fifth time I’m running for the presidency of the LDP, and it’ll be the last,” Ishiba said.

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