Japan's PM fights back with tax cut pledge

TOKYO (AFP) — Japan's new Prime Minister Taro Aso, hoping to rebound from a shaky start, Monday promised tax cuts to revive Asia's largest economy and ripped into the opposition in a feisty first address to parliament.

Japanese media said both major parties expected parliament to be dissolved as soon as Friday to make way for general elections next month, with Aso fearing he would only lose ground if he waited longer.

The conservative leader, who took office with his cabinet last week, delivered an unusually confrontational address to parliament, where he was nearly drowned out at times by opposition heckling.

Aso promised to cut income taxes by the end of the fiscal year in March in a bid to boost consumer spending -- a weak point in the world's second-largest economy, which is on the verge of recession.

"Japan must be strong. Japan must be cheerful," Aso said, in what was becoming his slogan. "I won't be pessimistic."

The premier pressed the opposition to pass an emergency budget to help Japan cope with soaring energy costs and to renew a contested naval mission supporting the US-led "war on terror".

"The passage of the supplementary budget is an urgent need," he told parliament hours after his cabinet submitted the 17 billion dollar proposal.

Aso began his address by offering a "deep apology" for nationalist remarks by his initial transport minister, who quit just days into the job after upsetting indigenous people and schoolteachers.

But he then lashed out at the main opposition Democratic Party of Japan (DPJ), which controls one house of parliament.

"The DPJ has merely put a priority on taking power and has treated people's lives as secondary," said the 68-year-old premier.

"People are closely watching whether the DPJ will neglect decision-making in parliament and continue to put people's lives second," he said. "I will never run away. I'm ready to have a real debate with the DPJ."

DPJ secretary general Yukio Hatoyama said Aso's speech was partisan rancour without policy substance.

"What is he thinking? Does he have to put so much focus in his very first parliamentary address on criticising the Democratic Party and the opposition?" Hatoyama said.

The opposition had demanded discussions with the government on the extra budget, which some economists argue is too small to boost the Japanese economy after it posted its largest contraction in seven years last quarter.

Aso's Liberal Democratic Party (LDP) has been in power for all but 10 months since 1955. But Aso's economic policies mark a break with recent LDP premiers who have put a priority on trimming a giant public debt.

"The objective of my cabinet is the prosperity of Japan," Aso said. "Without economic growth, we cannot achieve fiscal reforms."

He also urged the opposition to explain why it objects to a domestically unpopular naval mission providing support in the Indian Ocean to the US-led "war on terror."

"The war on terror isn't over yet," said Aso, an advocate for a more assertive nation on the world stage.

"Under these circumstances, as a member of the international community, we don't have the option of withdrawal," he said. "Does the DPJ still say (withdrawal) would be okay? Let us have your opinion."

The opposition forced a temporary halt last year to the operation, arguing the officially pacifist country should not take part in "American wars."

LDP lawmakers have hoped that Aso's initial popularity would allow him to safely call early elections, which do not have to be held until September next year.

The government's initial approval ratings, however, were less than 50 percent -- low compared with other LDP governments on taking office -- even before the furore over the transport minister's remarks.

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