Japanese Prime Minister Shinzo Abe says he has no plans to nix a consumption tax hike planned for next year, denying speculation that it will be postponed amid suggestions that Japan's economy won't be able to handle it.

Speaking at a news conference marking parliament's formal approval Tuesday of the government's 96.7 trillion yen ($850 billion) fiscal 2016 budget, Abe said the tax hike is needed to maintain Japan's welfare system and to secure confidence from markets and the international community.

The tax was due to rise to 10 percent from 8 percent in October, but was deferred until April 2017. Many in Japan are betting that with national elections looming this summer, Abe will be inclined to postpone the hike.