Japan’s Finance Minister Opens Door on Reserve Funds for Tax Cuts

Japanese finance chief Satsuki Katayama hinted that the country might look at surplus money in its foreign‑currency reserves to help pay for upcoming reductions in food sales tax. At a press briefing, she said that excess funds from the $1. 4 trillion reserve pool have historically been moved into the general budget account when needed. The minister clarified that she would not discuss whether the government will loosen rules that require at least 30 % of yearly surplus to stay in reserve. Easing those limits would free up more money for the general budget, potentially easing revenue gaps.Katayama’s comments suggest a willingness to consider unconventional funding sources as the country seeks ways to balance its budget while implementing tax relief. The idea of tapping reserve surplus reflects a broader trend of governments looking for new revenue options in tight fiscal environments. The decision to use reserve funds would involve careful planning, as the reserves serve as a safety net against market volatility. If allowed, shifting surplus into the general account could provide immediate fiscal flexibility but might reduce the country’s buffer against future economic shocks. Overall, the minister’s remarks signal that Japan is exploring all available avenues to finance its tax‑cut agenda while maintaining financial stability. The balance between short‑term relief and long‑term security will be a key focus for policymakers moving forward.