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Japan's ruling coalition backs down on fuel tax -- for now

by Staff Writers
Tokyo (AFP) Jan 30, 2008
Japan's ruling coalition, on the verge of another showdown with the opposition in a divided parliament, Wednesday called at least a momentary truce to plans to ram through a controversial fuel tax.

The current parliament session was set to be a duel between Prime Minister Yasuo Fukuda, who wants to maintain a tax at the pump, and the opposition, which has vowed to scuttle his agenda until he calls snap elections.

But the ruling coalition and the opposition, which took control of the upper house last year, agreed to accept mediation by lower house Speaker Yohei Kono, a leading moderate in Fukuda's Liberal Democratic Party (LDP).

"I think the people in the opposition made the decision as we are determined to pass this bill," LDP Secretary General Bunmei Ibuki said.

Yukio Hatoyama, his counterpart in the main opposition Democratic Party, declined to give details on the agreement, saying it was "as fragile as glass."

Japan has imposed a "temporary" additional tax on petrol since the 1970s, on top of a regular fuel tax, to finance road construction. It is due to expire at the end of March.

The ruling coalition wants to renew it, arguing it will help Japan fight global warming by capping fuel consumption while continuing to help build roads in rural areas.

The Democratic Party says the tax imposes a heavier burden on consumers as oil prices have rocketed and contradicts the government's policy of streamlining excessive road budgets.

Under Kono's mediating plan, the two sides will try to reach a compromise before the tax expires.

The confrontation grew so intense Tuesday that opposition lawmakers, holding banners saying, "Road patronage versus people's lives," tried to physically block the chamber where a lower house committee voted to extend the tax.

Parliament has been deadlocked since the opposition won the upper house in July, knocking the LDP out of the top spot for the first time since the ruling party was founded in 1955.

The government earlier this month took the almost unprecedented step of using its lower house power to override an upper house rejection and resume a controversial naval mission supporting the US-led "war on terror."

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Global automakers output hit by China snow storms
Shanghai (AFP) Jan 30, 2008
Fierce, driving snow storms in China disrupted global automakers' production at their joint venture factories owing to a lack of workers, parts and energy, the companies said Wednesday.

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