Japan's Abe says won't delay tax hike unless big shock hits economy

TOKYO (Reuters) - Japanese Prime Minister Shinzo Abe said on Sunday the government will proceed with a scheduled sales tax increase in 2019 unless the economy suffers a shock as big as the 2008 collapse of Lehman Brothers.

He also defended the government's plan to divert some of the proceeds from the scheduled tax hike to 10 percent from 8 percent to child care and education, saying that investing in children will "undoubtedly lead to stronger economic growth".

"Our administration has worked on fiscal reform more than any other administration," Abe told a television program as his ruling bloc headed for a big win in Sunday's general election.

"In order to pay back Japan's public debt, you need economic growth," he said.

"We'd like to proceed with fiscal reform by spurring economic growth and investment," Abe said, suggesting his administration will continue to focus on reflating growth rather than fiscal austerity.

Abe's ruling bloc was set for a big win in Sunday's election, bolstering his chances of becoming the nation's longest-serving premier. [nL4N1MX00Q]

Abe twice delayed the sales tax hike to 10 percent after an earlier increase to 8 percent tipped Japan into recession. Analysts say increasing the levy is crucial to rein in Japan's huge public debt which, at twice the size of its economy, is the biggest among major industrialized nations.

(Reporting by Leika Kihara; Editing by Dale Hudson)