As the Demographic Party of Japan's blueprint for pension reform remains ambiguous, we attempt to estimate the cost of the Minimum Guaranteed Pension financed by the consumption tax. The DPJ proposes that the MGP will be reduced for individuals in the high-income group, for example, making more than 3.0 million yen per year, and eliminated completely for those taking in around 6.0 million yen a year or more. However, in those settings of the range of income to determine the pension benefit, the DPJ's newly pension scheme will bankrupt soon. The reason is clear. Recently, there are many low-income in Japan and they will be paid the full amount of the MGP in the DPJ pension scheme. In case of changing the lower base remuneration of determining the pension benefit 3.0 million yen per year to 1.8 million yen a year, it is possible to introduce the MGP in a less than 5% consumption tax hike. Actually, the working and economic environment doesn't improve significantly, the level of consumption tax is to raise 20% more in the DPJ scheme. Even the lower base of making the pension benefit 1.8 million yen to 1.0 million yen, we need 14% increasing the level of the consumption tax. Before making the pension reform, the DPJ must improve the economy and working conditions.
