Policy Speech: Translate Takaichi’s Zeal into Specific Policies

Editorial

14:30 JST, February 21, 2026

Prime Minister Sanae Takaichi’s policy speech clearly conveyed her zeal for overcoming difficult issues with her own hands. The prime minister must use the current Diet session to clearly outline specific measures and a roadmap to this end.

Takaichi has delivered her policy speech at the plenary sessions of the House of Representatives and the House of Councillors.

She advocated moving forward with the administration’s approach of “responsible and proactive public finance.” “We should not hesitate to implement the fiscal measures necessary to achieve economic growth,” she said. “We will push the growth switch, push, push, push, push it relentlessly.”

The Japanese economy faces a significant decline in international competitiveness. Realizing a positive cycle — for example, one in which companies enhance productivity to increase profits, in turn leading to higher incomes that stimulate consumption — is essential.

From this perspective, the Takaichi administration’s policy of focusing investment on 17 key sectors, including artificial intelligence, semiconductors and shipbuilding, is understandable.

The prime minister indicated her administration plans to compile next month a roadmap for measures to encourage corporate investment. It will likely be difficult to provide uniform, blanket support for corporate investment. Priorities should be set regarding scale and timing, and progress should be made steadily.

In her speech, Takaichi said that the government will consider introducing refundable tax credits to reduce the people’s burden. Until that is realized, she stressed again that consideration should be accelerated on lowering the consumption tax on food items to zero for two years.

If refundable tax credits that combine income tax cuts and cash payments are implemented, accurate tracking of people’s income will be essential. Can such a mechanism be created?

What must not be forgotten is that the consumption tax in particular is the core source of financing that supports social security systems like pensions, medical care and nursing care. If alternative fiscal resources are not secured to cover the shortfall from the consumption tax cut, it would be difficult to maintain social security services.

If the nation’s finances deteriorate and the government loses its fiscal flexibility, it may no longer be able to implement effective measures in a crisis, like after a major disaster. Funding must also be secured to strengthen defense capabilities. It does not seem wise to divert stable fiscal resources to short-term measures to deal with rising prices.

Meanwhile, as to diplomatic and security policies, Takaichi said she will advance the free and open Indo-Pacific initiative Japan has advocated.

Specifically, she said Japan aims to build supply chains for critical materials with like-minded countries, as well as contribute to the peace and prosperity of the entire Indo-Pacific region through such efforts as providing defense equipment to developing countries.

Japan needs to deepen cooperation with other countries, particularly with members of the Association of Southeast Asian Nations, which are key partners.

(From The Yomiuri Shimbun, Feb. 21, 2026)