Japan’s Cabinet to approve 39 trillion yen economic package to combat rising prices

Tokyo, November 21 (IANS): Japanese Prime Minister Shigeru Ishiba’s cabinet is set to approve a 39 trillion yen (about $252 billion) economic package to support consumer spending as a measure to combat rising prices, local media reported Thursday.

The package will include subsidies to soften high prices for electricity, gas and gasoline, as well as providing cash transfers to low-income households, Xinhua reported, citing Kyodo News, citing people familiar with the matter.

The Cabinet plans to formalize the stimulus on Friday, planning to draw up a supplementary budget for fiscal year 2024 with about 13.9 trillion yen in general account spending to finance the package.

The package would also include a plan to raise the tax-free income threshold, yielding to demands from the opposition party whose votes are needed for the ruling coalition to take action, the report said.

The ruling coalition of the Liberal Democratic Party and its partner Komeito, which lost its majority in last month’s general election, accepted the Democratic Party for the People’s request to raise the level of tax-free income from the current 1.03 million yen in order to win the election. support for the adoption of the budget bill.

The opposition party is seeking to raise the cap to 1.78 million yen to stimulate consumption, but the government estimates the proposal could cut annual tax revenue by about 7-8 trillion yen.