What happens in the Japan Special Diet February 18 session?

Lawmakers reconvene to re elect Sanae Takaichi as prime minister, launch her second cabinet, and keep all ministers in place. The government then submits priority bills, including the FY2026 budget. Committee scheduling begins immediately, setting the path for a swift vote and early policy delivery.

How fast could the 2026 budget pass?

With Lower House priority and an LDP supermajority, the bill can clear the first chamber quickly. If the Upper House does not act within 30 days, the Lower House decision stands. A late March enactment is feasible if schedules are published and committees keep to plan.

What tax changes are being discussed?

Debate centers on targeted income relief for households and incentives for corporate investment, such as stronger R&D deductions. The size and start date remain open. Funding could mix spending reallocation, non tax revenue, and JGB issuance, with signals expected in the Feb 20 policy address.

Why does the March U.S. summit matter for markets?

It could align defense, technology, and supply chain plans, shaping procurement timing and project pipelines. Clearer frameworks tend to support firms in defense, electronics, shipbuilding, and semiconductors. The summit also anchors risk views on the region, informing currency and equity positioning across Japan sectors.

Law and Government

Japan Special Diet, February 18: Takaichi’s 2nd Cabinet Fast‑Tracks Budget

ByHuzaifa Zahoor February 18, 2026February 18, 2026

The Japan Special Diet February 18 starts a fast handover from election to policy. Lawmakers will re elect Sanae Takaichi, form her second cabinet, and keep all ministers in place after the LDP supermajority win. The agenda centers on proactive fiscal policy, a quick 2026 budget passage, and security strengthening. Markets will watch the Feb 20 policy address for tax cut details and spending priorities, then look to a planned March U.S. summit for security and technology signals. For retail investors in Japan, the timeline and tone can shape sector flows and near term risk.