Japan to spend $320 billion on stimulus package

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Japan to spend $320 billion on stimulus package

TOKYO Kyodo submitted a draft extra budget for fiscal 2021 worth 36.0 trillion yen $320 billion to the government to partially finance its latest economic package, which is intended to help the economy recover from the coronaviruses epidemic.

The first supplementary budget for the current fiscal year through March will be prepared by Prime Minister Fumio Kishida's administration for a wave of COVID-19 infections that could occur during the winter, amid growing concerns over the emergence of the Omicron coronaviruses variant.

The additional budget involves the issuance of new government bonds worth 22.1 trillion yen, which has led to the fear of a further deterioration of Japan's fiscal health, already the worst among major developed nations.

The supplementary budget was drawn up last month after Japan saw a decrease in new virus cases due to the progress in the government's vaccine program, with various restrictions on domestic economic activities being lifted gradually.

The budget is expected to be approved by the Diet in an extraordinary parliamentary session that will be convened Monday afternoon and runs through December 21.

Of the total, 31.6 trillion dollars will be used for the newly compiled stimulus plan, which will entail a record 55.7 trillion yen in fiscal spending. The policy package is worth about 78.9 trillion yen when private funds are included.

As well as other measures to prevent the disease from spreading, a total of 18.6 trillion yen will be allocated, including 2.0 trillion yen assistance for medical institutions to secure more beds for COVID- 19 patients.

To promote the government's COVID 19 vaccine rollouts, 1.3 trillion yen are earmarked, with 601.9 billion yen set aside to purchase treatment drugs.

The stimulus package has a total of 100,000 yen handouts in cash and vouchers for children aged 18 or younger in households where the primary earner's annual income is less than 9.6 million yen. There will be 1.2 trillion yen allocated for the project under the extra budget.

Some 268.5 billion yen will be used to restart the Go To Travel subsidy program, which is designed to prop up the pandemic-stricken domestic tourism sector. Since payments for allowances for furloughed workers have been increasing, the government will use 1.7 trillion yen to increase funding for its unemployment insurance system. A cash handout scheme of 100,000 yen will be created by the government and will provide low-income households with 1.4 trillion yen.