Japan tax agency head set to resign amid cronyism scandal: source

FAN Editor
Nobuhisa Sagawa, Director-General of the Ministry of Finance Financial Bureau, answers a question at the parliament in Tokyo
Nobuhisa Sagawa, Director-General of the Ministry of Finance Financial Bureau, answers a question next to Japan’s Prime Minister Shinzo Abe and Finance Minister Taro Aso during a lower house session at the parliament in Tokyo, Japan February 24, 2017. Mandatory credit Kyodo/via REUTERS

March 9, 2018

By Linda Sieg and Kiyoshi Takenaka

TOKYO (Reuters) – Japan’s National Tax Agency chief, who has been under fire for remarks in parliament about a suspected cronyism scandal that threatens to erode Prime Minister Shinzo Abe’s popularity, intends to resign, a ruling party source said on Friday.

Public broadcaster NHK and other media also reported that Nobuhisa Sagawa would step down, while private broadcaster Nippon TV said Finance Minister Taro Aso, who appointed him, would hold a news conference.

Suspicions that a school operator with ties to Abe’s wife, Akie, got a sweetheart deal on land for a school in the western city of Osaka helped dent the premier’s popularity last year.

Abe has denied that he or his wife did favors for the former head of school operator Moritomo Gakuen, Yasunori Kagoike.

Media said on Friday that police were investigating as a possible suicide the death of an official at a finance ministry bureau that handled the land deal at the center of the scandal.The official in the western region where the school is located was found dead at his home on March 7 and police are investigating the matter as a suicide, Kyodo and Jiji news agencies said. A police spokesman declined to comment.

Chief Cabinet Secretary Yoshihide Suga told a regular news conference that he had been notified about the death of the official but declined to give any details. He said he did not know whether the official had been questioned by prosecutors.

Asked about the reports of the possible suicide, Aso told reporters: “I’ve heard about the matter.”

The former head of the school operator and his wife were arrested in July on suspicion of illegally receiving subsidies.

Abe, in his sixth year in office and eyeing a three-year extension from September, had seemed to put the matter behind him with a big election win for the ruling bloc in October.

But opposition parties have turned up the heat again after the Asahi newspaper said some documents about the land sale might have been doctored.

That followed revelations that the finance ministry had retained documents that officials had said no longer existed. Last year, Sagawa, then the head of the ministry’s financial bureau, told parliament the materials had been discarded.

Protesters demanding the resignations of Sagawa and Aso – who had said the tax agency head’s appointment was “appropriate” – have gathered in front of the ministry in recent weeks.

The ministry on Thursday released to parliament hundreds of pages of what it said were copies of the original documents, but opposition lawmakers said their doubts remained.

Aso, a close Abe ally, could end up in the hot seat if it turns out that officials of his ministry altered approved documents.

Abe’s ruling bloc has big majorities in both houses of parliament, so his grip on power appears unlikely to be at risk.

But falling support could complicate his bid for a third term as Liberal Democratic Party leader in a September party vote. Re-election would put him on track to become Japan’s longest-serving premier.

(Reporting by Linda Sieg and Kiyoshi Takenaka; Editing by Richard Borsuk and Nick Macfie)

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