Overview
- Ruling and opposition negotiators, including the LDP and Constitutional Democrats, are aligning to abolish the roughly ¥25-per-liter provisional gasoline levy on December 31, 2025.
- Decisions on how to replace the lost revenue are being postponed, with tax reforms under consideration that include tightening corporate tax preferences, higher burdens on very high incomes, and revisions to automobile-related taxes.
- Transitional relief would add subsidies from November 13 to lower pump prices in stages, reaching an amount equivalent to the surtax by December 11.
- Diesel support would rise from November 13 and match the light oil surtax by November 27, with the diesel surtax slated for repeal on April 1, 2026.
- Prime Minister Sanae Takaichi aims to pass the repeal in the current extraordinary Diet session, while stable road-maintenance funding is to be settled by the end of 2026 using temporary non-tax revenues rather than new bond issuance in the interim.