Prime Minister Fumio Kishida Unveils 13.1 Trillion Yen Supplementary Budget for Comprehensive Economic Measures

Prime Minister Kishida Announces 13.1 Trillion Yen Additional Budget for Comprehensive Economic Measures

On November 2nd, Prime Minister Fumio Kishida declared during a government and ruling party policy meeting that the supplementary budget for comprehensive economic measures would amount to 13.1 trillion yen. This budget includes fixed tax cuts totaling around 17 trillion yen. The Prime Minister also shared plans to swiftly draft a supplementary budget bill for fiscal 2023 to support this initiative and aims to enact it as soon as possible. The comprehensive economic measures aim to completely overcome deflation and were decided by the Cabinet earlier this evening.

Key Aspects of the Measures

• The total expected cost is approximately 17 trillion yen and includes various “return measures” such as fixed income tax cuts.
• The overall fiscal expenditure, covering national and local expenditure as well as FILP, will be 21.8 trillion yen, with the project’s cost reaching 37.4 trillion yen.
• Additionally, there will be an additional 1.2 trillion yen allocated to the special account. Following the decision on these measures, a supplementary budget bill for fiscal 2023 will be created, with the goal of enacting it within the month.

Prime Minister Kishida’s Vision

Ahead of finalizing the measures, Prime Minister Kishida highlighted an important turning point: “The tide is turning from the vicious cycle of deflation, providing us with a significant opportunity to enter a new economic era for the first time in 30 years. We consider this the most crucial pillar of our countermeasures.”

Breakdown of the Additional Budget Allocation

According to a summarized breakdown obtained by Reuters, out of the 13.1 trillion yen additional general account budget, the main measures combatting high prices will receive 2.7 trillion yen. Sustainable wage increases and regional growth will be allocated 1.3 trillion yen, whilst domestic investment promotion will receive 3.4 trillion yen. Preventing population decline will entail a budget of 1.3 trillion yen, and enhancing national resilience will require 4.3 trillion yen. Before finalizing these budgets, the Prime Minister explicitly stated that the measures would be based on five pillars.

Specific Allocation of Funds

• Approximately 1.1 trillion yen is earmarked to support low-income individuals through priority local aid grants, with an estimated 15 million households receiving 70,000 yen.
• Gasoline subsidies will be extended until the end of April, with an additional 0.8 trillion yen allocated to electricity and gas subsidies, gradually reducing after May.
• To achieve sustainable wage increases and regional growth, the government will expand subsidies for small and medium-sized businesses and enhance the treatment of nursing care workers.
• The advantageous weak yen environment will be utilized to boost exports of agricultural, forestry, fishery products, and food items.
• Further promotion of the semiconductor field will be a key driver in promoting domestic investment, with an additional 2 trillion yen allocated, including GX (green transition) financial resources.
• The Japan Aerospace Exploration Agency (JAXA) will establish a 10-year Space Strategy Fund worth 1 trillion yen, with an additional 0.3 trillion yen set aside in the supplementary budget. Collaboration with the Ministry of Defence is also being considered for strengthening the space field.
• The measures to prevent population decline include allocating 0.5 trillion yen to standardize local government systems promoted by the Digital Agency and adding grants for the Digital City Garden Nation Initiative. Measures to address dementia will also be included.
• Efforts towards national resilience, safety, and security will be further supported by measures aimed at strengthening relations and providing additional support to developing and developing countries in the so-called Global South. Secure financial resources are integral to this endeavor.

Upcoming Announcement and Decision

The measures will be officially decided at an extraordinary cabinet meeting later tonight. Prime Minister Fumio Kishida will subsequently hold a press conference to elucidate the goals and details of this comprehensive economic plan.

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On November 2nd, Prime Minister Fumio Kishida (pictured) announced at a government and ruling party policy meeting that the supplementary budget for comprehensive economic measures would be 13.1 trillion yen, and the amount would including fixed tax cuts amounting to about 17 trillion yen. Photo taken in March in Tokyo (2023, Reuters)

TOKYO (Reuters) – Prime Minister Fumio Kishida announced at a government and ruling party policy meeting on the 2nd that the additional general account spending will be 13.1 trillion yen in line with the comprehensive economic measures to decided by the Cabinet tonight. He said he would immediately draw up a supplementary budget bill for fiscal 2023 to support the move, and would “aim to enact it as soon as possible.” set as “comprehensive economic measures to completely overcome deflation.”

The measures are expected to cost about 17 trillion yen, including “return measures” such as fixed income tax cuts and related expenses. The fiscal expenditure, including national and local expenditure and FILP, will be 21.8 trillion yen, and the cost of the project will be 37.4 trillion yen.

On the other hand, the additional amount in the special account will be 1.2 trillion yen. After the measures have been decided, a supplementary budget bill for fiscal 2023 will be drawn up, with the aim of enacting it within the month.

Before deciding on the measures, the prime minister said, “The tide is turning from the vicious cycle of deflation and we have a great opportunity to move into a new economic era for the first time in 30 years. “We are doing this. the most important pillar of our countermeasures,” he said.

According to a summary obtained by Reuters earlier, of the 13.1 trillion yen that will be added to the general account budget, 2.7 trillion yen will be allocated to the main measures to combat high prices. 1.3 trillion yen will be earmarked for sustainable wage increases and regional growth, 3.4 trillion yen for promoting domestic investment, 1.3 trillion yen for preventing population decline, and 4.3 trillion yen for national resilience. Before drawing them up, the Prime Minister announced that the measures would be based on five pillars.

As part of the measures to combat high prices, 1.1 trillion yen will be allocated to support low-income people through priority local aid grants, with the assumption that around 15 million households will receive 70,000 yen. In addition to gasoline subsidies, which will be extended until the end of April, a total of 0.8 trillion yen will be added to electricity and gas subsidies, including those for May, which will be reduced gradually.

In order to achieve sustainable wage increases and regional growth, the government will include related expenses with an eye towards expanding subsidies for small and medium-sized businesses, improving treatment for nursing care workers, and addressing the annual income barrier. The government will also take advantage of the weak yen environment to boost exports of agricultural, forestry and fishery products and food products.

The further promotion of the semiconductor field is set as a pillar of promoting domestic investment. The measures will include an additional 2 trillion yen, including GX (green transition) financial resources.

Prior to the establishment of a 10-year Space Strategy Fund (1 trillion yen) in the Japan Aerospace Exploration Agency (JAXA), 0.3 trillion yen will be set aside in the supplementary budget. In the future, we will also consider collaborating with the Ministry of Defence, which has recommended strengthening the space field as a new domain alongside cyber and electromagnetic waves in three new documents relating to security.

Meanwhile, as part of measures to prevent population decline, in addition to setting aside 0.5 trillion yen for the standardization of local government systems promoted by the Digital Agency, the government will also add grants for the Digital City Garden Nation Initiative . Measures against dementia will also be included.

In addition to expanding support to Ukraine’s neighboring countries, efforts towards national resilience and the safety and security of the people are envisaged and supported by additional support measures aimed at strengthening relations with developing and developing countries. n development in the so-called Global South. secure financial resources.

The measures will be officially decided at an extraordinary cabinet meeting tonight, and Prime Minister Fumio Kishida will hold a press conference to explain the goals.

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