TOKYO: Japanese Prime Minister Sanae Takaichi announced on Thursday (Jul 30) her intention to proceed with a two-year cut on a sales tax of 8 per cent on food items, a move set to strain the country's worsening finances. "We will lower the sales tax on food items to 1 per cent for two years from April next year," Takaichi told reporters after ordering ruling party executives to prepare for the cut. To fund the tax cut, the government will seek to tap non-tax revenues, such as proceeds from state funds and foreign reserves as well as spending reforms, Takaichi said. The government is likely to finalise the tax cut plan at a cabinet meeting in early August, and submit relevant legislation in a parliament session set to begin in autumn. If adopted, the measure would be Japan's first time lowering the sales tax since it was introduced in 1989.