The Yomiuri Shimbun reported on the 20th, citing multiple government officials, that the Japanese government has decided to spend more than 2 trillion yen (about 19.78 trillion won) from the 2022 budget reserve as a new countermeasure against high inflation.
The main point is to add a total of 1.2 trillion yen (approximately 11.87 trillion won) to the ‘local revitalization temporary subsidy’, which promotes measures at the discretion of each local government, so that it can respond more flexibly to local conditions. On the 22nd, at a meeting of the Headquarters for Price, Wage and Livelihood Comprehensive Countermeasures Headquarters headed by Prime Minister Kishida, the spending plan will be decided.
The temporary subsidy for local revitalization is expected to add 700 billion yen (approximately 6.92 trillion won) to the framework prepared for countermeasures against high inflation in September last year. The use is decided by the local government, but the government plans to stipulate in the ‘recommended projects’, such as reducing the burden of LP gas or special high-voltage power exclusively for factories, and supporting dairy farmers suffering from rising feed prices.
The Japanese government introduced subsidies for electricity rates and city gas rates from February meter reading (January use), but LP gas was excluded. As there are many households using LP gas in the provinces, voices calling for support were growing even within the ruling party.
It can continue to be used for previously suggested projects such as measures for public transportation and tourism operators, subsidy for school meal expenses, etc.
The remaining 500 billion yen (approximately 4.94 trillion won) of the grant will be designated as a special scope, and 30,000 yen (approximately 300,000 won) will be paid uniformly to low-income households such as resident tax exemption. At the discretion of the local government, changes such as reducing the amount of benefit below 30,000 yen and expanding the number of eligible households are also possible.
Apart from the subsidies, low-income households will receive 50,000 yen (approximately 500,000 won) per child. In addition, the ‘Emergency Comprehensive Support Subsidy’, which is supported by local governments for hospitals that have secured beds to respond to Corona 19, will be significantly increased. The government will also continue to curb the selling price of imported wheat, which is strongly affected by inflation. A total of about 1 trillion yen will be appropriated for these measures, Yomiuri said.
Yomiuri reported that “the Japanese government has set countermeasures against high inflation as the most important task for the local elections in April,” and “there is a possibility that the scale of the final countermeasures may increase in coordination with the ruling party in the future.”
Source: Donga
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