Preliminary data from Japan show a 6.8 percent drop in quarterly gross domestic product.

Although a drop in consumption was expected after Tokyo raised the consumption tax rate from 5 percent to 8 percent in April, the decrease is more than experts had expected. And while the government of Japan sees increasing the consumption tax rate as one way to tackle its mountainous public debt, counterproductive quantitative and qualitative easing (QQE) may not be what’s best for Japan or Prime Minister Shinzo Abe.

Some of the largest decreases were in domestic demand, with private and household consumption down over 18 percent each. Both imports and exports were down, despite the Bank of Japan’s continuous QQE bond buying of 6 trillion to 8 trillion yen per month and the value of the yen down to the equivalent of what it was during the 2008 financial crisis. Government consumption was the only indicator with positive growth.

In 1997, the government of Japan increased the consumption tax from 3 percent to 5 percent. Japan ended up in falling into recession afterwards with little to no growth in private consumption. Nominal spending is already lower that it was in 1997.

The validity of Abe and the Bank of Japan’s “virtuous cycle” of increasing inflation in the hope of increasing economic output has become more of a concern. Inflation continues to increase while real wages continue falling, running 3.8percent lower in May than a year earlier.

Abe will decide sometime in December whether he will continue with the planned consumption tax increase of 8 percent to 10 percent in 2015. Much of the decision will rest on the third-quarter report of July to September, which is to be released in November. But because the decline was so severe in the second quarter, any growth in the third quarter may be used as an excuse to continue with the tax increase and QQE. A recent poll showed 75 percent of residents oppose the next consumption tax increase.

Recent research has shown an increase in taxes is more damaging to an economy than cutting spending.

Abe’s approval ratinghas been slowly falling, making it harder (if not nearly impossible) for him to pass meaningful structural reform highlighted in his “third arrow.” Abe should focus less on herding Japan’s animal spirits with monetary and fiscal policy and, while his approval rating is still strong, take on bigger tasks such as seeking more foreign investment in Japan by increasing domestic competition, continuing to push for a meaningful Trans-Pacific Partnership, and opening up Japan’s workforce to more women and immigrants.