Photo/Illutration A steel plant's chimney in Muroran, Hokkaido, in 2010. Japan's greenhouse gas emission fell to record low in fiscal 2020. (Asahi Shimbun file photo)

The chairman of the Liberal Democratic Party’s Research Commission on the Tax System said on Nov. 17 that the party will not introduce a carbon tax in the next fiscal year’s tax reforms.

“The LDP’s Research Commission on the Tax System has no plan at all to discuss the carbon tax, at least this year,” Yoichi Miyazawa said at a meeting held by various organizations, including the Petroleum Association of Japan, which opposes a carbon tax.

The Environment Ministry had called for its introduction to help reduce carbon dioxide (CO2) emissions and help the government’s ambitious goal of Japan reaching net-zero carbon emissions by 2050.

But many in the business community are wary about the additional burden it would place on them and have shown a persistent reluctance about supporting the idea.

Discussions about fully introducing the tax have been shelved for the time being.

A carbon tax is levied based on the amount of CO2 emitted from using fossil fuels, such as coal and oil. Experts see it as a key measure for tackling global warming by reducing emissions and many countries in Europe have already introduced one.

While the Environment Ministry is pushing for a carbon tax, the Ministry of Economy, Trade and Industry (METI) has expressed reservations on the burden it would place on businesses. Detailed discussions over introducing such a tax have yet to take place.

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