Japan's Ichiro Ozawa forms opposition political party

  • Veteran Japanese politician Ichiro Ozawa has formed a new opposition party.

    Ozawa resigned from the ruling party over plans to raise sales tax.

    His party is now the third largest in parliament's lower house.

    His departure from the Democratic Party of Japan along with 48 other MPs on July 2 dealt a hefty blow to Prime Minister Yoshihiko Noda.

    Noda says doubling sales tax from 5 percent to 10 percent by 2015 is crucial to cutting the country’s high public debt and funding rising welfare costs.

    The bill has already been passed in the lower house.