BOJ: Outlook Forecasts Exclude Proposed Temporary Food Sales Tax Cut

The BOJ's decision to keep the proposed food tax cut out of its baseline matters because it means the published inflation path is not a clean read on policy if the measure passes. The mechanical hit to core and core-core CPI in fiscal 2027 is large enough to muddy the distinction between underlying price pressure and a legislated distortion — precisely the signal the BOJ watches. Whether the cut is enacted, and how the BOJ adjusts its projections and communication once it is, is the open question.