One of Japan's most influential leaders, Ichiro Ozawa, has left the ruling camp along with 49 other lawmakers in protest against Prime Minister Yoshihiko Noda's tax-hike legislation.
The 50 lawmakers - 38 from the lower chamber and 12 from the upper house of parliament - tendered their resignations to Prime Minister Noda on Monday.
The departure of Ichiro Ozawa and other ruling party lawmakers has left the ruling Democratic Party of Japan (DPJ) with a slimmer majority in parliament's powerful lower house, raising the prospect of Prime Minister Noda's ouster.
The resigning members are likely to form a new political party under Ozawa.
The DPJ will lose its majority in the lower house if 55 of its members quit the ruling camp. This can also lead to a no-confidence vote against the Prime Minister. If PM Noda loses the majority in the lower house, he would have to either resign or dissolve parliament to hold general elections.
'An act of betrayal'
Last week, the ruling DPJ passed a divisive bill in the lower house to raise consumption taxes that would increase the current five percent sales tax to eight percent in April, 2014, and to 10 percent in October, 2015. Although PM Noda managed to pass the bill, 57 legislators of his party voted against it, while 15 abstained in an obvious sign of revolt.
Prime Minister Yoshihiko Noda argued that the tax-hike was necessary to cover Japan's rising social security costs, as the number of elderly people in the country continues to grow.
Ozawa said the tax hike was "an act of betrayal to the public" on part of the DPJ.
Critics of the bill say that instead of increasing taxes, Prime Minister Noda should tackle deflation, which contributes to unemployment in Japan.
The split in the ruling camp is a severe blow to PM Noda, who took office in September. Noda's own popularity is dwindling. According to a survey by the Japanese Jiji Press Agency in June, the public approval rating for Noda's cabinet stood at only 24 percent.