Japan tankan sentiment drop worse than 1997 tax hike: BOJ official

The pace of decline in the Bank of Japan's tankan sentiment outlook is more than the last time the government raised the sales tax in 1997, a central bank official said on Tuesday.

The BOJ's closely watched tankan survey showed on Tuesday that the headline index for big manufacturers' sentiment was plus 17 in the March quarter, less than a median estimate for plus 18.

Companies expect the sentiment index to fall to plus 8 in the June quarter, the survey showed, due to worries about the economy as an increase in the sales tax, which takes effect on Tuesday, is expected to slow consumer spending.

(Reporting by Stanley White; Editing by Dominic Lau)