Tokyo: Prime Minister Shinzo Abe is set Tuesday to call a snap election, and seek voters' endorsement for more economic reforms after Japan slipped into recession.
Less than two years after he swept to power pledging to reinvigorate the country's flagging economy, Abe is expected to say more needs to be done to fix years of growth-sapping price-falls.
"We are eventually taking the opportunity to get rid of deflation," Abe told a meeting of lawmakers and officials from his junior coalition partner Komeito.
The last 24 months have seen two of the so-called "three arrows" of "Abenomics" fired -- massive fiscal stimulus and a flood of easy money. A third "arrow" of structural reforms is stuck in the quiver, a victim of the vested interests it is intended to undermine.
At its heart, Abenomics is intended to push prices up and get shoppers spending, with the aim of generating a self-reinforcing recovery as companies employ more people to meet growing demand.
The measures have sent the yen plunging, pushing up the cost of imports, including the fossil fuels used to power the country.
That stretched consumers -- 60 per cent of the economy -- who were then walloped again in April after sales taxes rose from 5.0 to 8.0 per cent, resulting in two consecutive quarters of contraction.
Abe is almost certain today to say he is delaying part two of the tax rise -- to 10.0 per cent -- which is due for October.
"I will judge the consumption tax calmly," he said. "People's life won't get better without economic growth."