The Japanese government is reportedly in the process of drafting a supplementary budget of approximately 13.5 trillion yen ($87 billion) to support a stimulus package aimed at assisting low-income households and counterbalancing the effects of increasing prices, as per media reports.
As part of the proposed plan, low-income households exempt from residential taxes would receive 30,000 yen ($193), while households with children would receive 20,000 yen per child, as reported by the Sankei newspaper on Wednesday.
Furthermore, the government is contemplating the reinstatement of subsidies for electricity and gas prices for a period of three months starting from January in response to soaring fuel costs, according to three sources familiar with the situation who spoke to Reuters.
These subsidies had been terminated at the end of last month. Tokyo is also mulling over the gradual phasing out of separate subsidies for gasoline fuels, which were initially set to conclude in December, the sources added.
Over the past three years, the government has allocated 11 trillion yen to help mitigate the impact of escalating utility expenses and gasoline prices on households.
Prime Minister Shigeru Ishiba aims to finalize the stimulus package on Nov. 22, although the plans could be subject to change following discussions with opposition parties, particularly in light of the ruling Liberal Democratic Party (LDP) and its coalition partner Komeito leading a delicate minority government after the recent snap election.
($1 = 155.3700 yen)
Analysis:
The Japanese government is taking significant steps to provide financial support to low-income households and address the challenges posed by rising prices. Through a substantial stimulus package and supplementary budget, households are set to receive assistance in the form of direct payments and subsidies for essential utilities. These measures aim to alleviate the financial burden on vulnerable groups and stimulate economic growth. As a result, individuals and families may experience improved financial stability and reduced cost pressures, ultimately enhancing their overall well-being and quality of life.