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Mr Abe was elected two years ago with an ambitious plan to revive the economy, but has struggled to do so.
His popularity has fallen but he is expected to win the election, which will take place in mid-December.
"I will dissolve the lower house on 21 [November]," Mr Abe said.
Mr Abe's party, the Liberal Democrats, already have a majority in the lower house, but analysts said Mr Abe hoped to consolidate power over an opposition party which is in disarray.
He also wants public support to continue to press ahead with "Abenomics", his ambitious plan to kick-start Japan's stagnant economic growth using heavy government spending and economic reforms.
"I need to hear the voice of the people," Mr Abe said. "I will step down if we fail to keep our majority because that would mean our Abenomics is rejected."
One of his senior advisers told the BBC instability was the last thing voters want.
"Many people in Japan still remember how chaotic Japan's revolving door politics was, when the prime minister changed once every year," said Tomohiko Taniguchi, special adviser to the cabinet.
Consumers not spending The rise in Japan's sales tax was brought in by the previous government in 2012 to curb Japan's huge public debt, which is the highest among developed nations.
The first rise - from 5% to 8% - took place in April. Mr Abe's government had hoped the increase would boost government income but instead Japanese consumers stopped spending.
Figures released on Monday showed that the world's third biggest economy had fallen back into a technical recession.
The second increase, to 10%, was set for October 2015 but will now be delayed by at least 18 months.
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