Japan's Ichiro Ozawa quits ruling party over sales tax

Japan's ruling party powerbroker Ichiro Ozawa leaves his home in Tokyo on 2 July, 2012, in this photo taken by Kyodo Ichiro Ozawa is a former DPJ leader with considerable political clout

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Faction leader Ichiro Ozawa has resigned from the ruling Democratic Party of Japan (DPJ), along with 49 other lawmakers, officials say.

The exodus, which has been expected for some time, still leaves the DPJ with a majority in the lower house of parliament.

But the move is a blow to Prime Minister Yoshihiko Noda, with Mr Ozawa expected to form his own party.

Mr Ozawa is opposed to the sales tax hike passed in parliament a week ago.

"The DPJ is no longer the same party that I founded," Mr Ozawa said in a press conference.

"Its deal with the opposition parties to hike the sales tax is undemocratic. I'm considering forming a new party to give voters an option," he added, but did not say when.

A party official told reporters that 38 lawmakers from the lower house and 12 from the upper chamber of parliament were leaving the party.

Earlier reports had said that a total of 52 lawmakers had submitted resignation letters, citing an official close to Mr Ozawa. The official told reporters that two lawmakers had retracted their resignations.

If 54 or more lower house lawmakers follow Mr Ozawa, Mr Noda would lose his majority and could be forced to call early polls.

The prime minister would be meeting senior party officials to discuss the matter, reports said.

'The destroyer'

The prime minister says doubling sales tax from 5% to 10% by 2015 is key to cutting Japan's high public debt and funding rising welfare costs.

The tax hike has seen bitter disagreement and gridlock amongst Japan's lawmakers.

Mr Ozawa, who led the charge against Mr Noda, is a veteran politician leading the biggest faction within the DPJ.

This is not the first time that Mr Ozawa, dubbed "the destroyer", has torn apart a ruling party, says the BBC's Mariko Oi in Tokyo. In 1993, he left the Liberal Democratic Party to form his own party.

But voters do not appear to be impressed, says our correspondent, with the latest opinion poll saying only 15% of them support his move.

Some analysts said the exit of Mr Ozawa and his faction could actually make it easier for Mr Noda to consolidate the ruling party and make deals with the opposition.

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