Japan may dip into forex reserves to make good revenue shortfall

Tokyo

THE Japanese government may be forced to tap into the nation's foreign-exchange reserves of more than US$1 trillion, in order to keep its promise to the international community that its national consumption tax would be raised next year on schedule, say news reports.

The Nihon Keizai Shimbun, a newspaper also known as the Nikkei, said government officials are discussing the option of using the foreign reserves to cover an expected revenue shortfall of some 600 billion yen (S$7.3 billion) caused by exempting food items from the higher rate of consumption tax due to take effect in April 2017.