Overview
- Government talks have moved toward a five‑year defence package near ¥50–60 trillion with multiple reports centring on about ¥60 trillion as the working figure.
- Prime Minister Sanae Takaichi has told aides she is wary of large tax hikes to pay for defence, and senior officials say a dedicated ‘defence tax’ is not desired.
- The Defence Ministry’s internal estimate near ¥80 trillion remains on the table but Finance officials call that figure unrealistic and are pressing for cuts.
- Ministers are weighing limited revenue options such as modest corporate tax increases that could yield roughly ¥1 trillion a year and delaying costlier domestic programs like a retired SDF support agency.
- To meet U.S. expectations on burden sharing the government may widen the definition of security spending to include economic security items such as semiconductors, critical minerals and space, building on the 2022 move to count broader security costs toward a GDP target.