The IMF is urging Japan to go ahead with its second tax hike.

Japan needs to go ahead with its second tax hike next year in order to maintain credibility of its fiscal framework. Japan's national sales tax rose to 8% from 5% in April and the government is due to decide by year-end whether to proceed with a second tax increase to 10%. The IMF expects Japan's economy to grow by an annualized 3.4% in July-September, rebounding from its deepest slump since the 2009 global financial crisis last quarter following April's tax hike.