Cabinet to OK ¥39 tril economic package to ease price pain

7-8 trillion off the backs of the working poor. Shameful. The top 0000.1% could write a check for that in seconds. Shameful.

The Liberal Democratic Party and its junior coalition partner, the

Komeito party, accepted a request from the opposition party, the

Democratic Party for the People, to raise the nontaxable income level

from the current 1.03 million yen in a bid to win its backing for the

budget bill passage.

Seems deliberately vague about the request to raise it to 1.78 mil. The final result will probably be much lower which will not do much for Japan's hordes of working poor in precarious zero hour contract jobs making 2 mil or so and subject to income, sales, city, pension, social insurance taxes on meager take home pay.

They will be feeling the pain of this economic stimulus package and paying for it, and receiving no relief.

Raising the 1.3 million threshold is a good move. But the rest is not going to do much.

Financing such a massive package requires keeping interest rates very low. This will inevitably lead to further depreciation of the JPY and increased imported inflation.

As a result, whatever people gain from cash handouts and subsidies will likely be more than offset by inflation. This is especially true for low-income earners, who typically consume their entire income. A one-off payment of 30,000 JPY will never compensate for the additional inflation they will face.

This economic policy is absurd.

“Still suffering the worst fiscal health among advanced countries” Probably the worst health too given all that fried chicken and processed food everywhere.

How about putting an end to taxing food.

"The economic stimulus will include subsidies to offset high electricity, gas and gasoline prices and deliver cash handouts to low-income households."

Worldwide push to ban viable efficient sources of energy for expensive inefficient sources of energy in the name of climate change. What could go wrong?

How Japan fight inflation? Easy just pouring more money, well done.

Newgirl

Definitely not the worst health. All that cycling and walking about does wonders to prevent a nation of fatties.

"economic package" Now that is a generous phrasing. I would call it an economic handout. Those that are really teetering into poverty will spend it on essentials. Many will simply park it in a bank account.

NewgirlintownToday  07:19 am JST

“Still suffering the worst fiscal health among advanced countries” Probably the worst health too given all that fried chicken and processed food everywhere.

Japan being one of the most healthiest country in the world.

such a critic does not credit you.

The two cuprits in this are the corporations and the BOJ. The central's bank ultra loose policy is trouncing the yen, making the food and energy way more expensive than it should be. Employers, meanwhile, are raking in record-high profits amid the misery yet refuse to pay wage rises in line with inflation. Let's put blame where it deserves.

The govt is culpable, too, but by a lot less than the two above. I'd blame it for giving the corporates a tax cut at the same time it raised the consumption tax about five years ago. I predicted at the time the move would cause misery, it should be pointed out!

Be careful what you wish for. Raising the tax threshold for being exempt from residence tax and qualifying for other benefits will only act to hit those in the low income brackets just above the new threshold. So low income earners who pay tax and health insurance will get another hit to their income.

Raising it to 1.7 million yen sounds good for populist reasons -but this kind of hike will also result in trillions of yen of lost revenue and yet again, very low income earners who don't qualify for exemptions and low/lower middle income earners will make up the shortfall.

As for the poster on here making comments about 'gaijins' and 'gaijins giving money back' to the J Govt - why are you on here wasting everybody's time? Yeah, I don't like some foreigners who are here to continue their high school party life and are annoying narcissists who are winging it in their 'teaching' jobs while helping drive down wages and conditions in that industry. As well as being deadbeats behind on their tax obligations etc. But the fact is foreigners who are paying taxes etc are contributing to Japan so stop calling them 'gaijins' especially on a foreigner based Japan news website.

Japanese money printers go brr... causing the yen to fall further. Reduce consumption tax on food for Gods sake.

it doesn’t help that it is not worth earning over a certain amount due to the strange tax system. All the students and some part timers want to work more to earn some more money but now they’ve reached a limit and have been basically told not to work anymore until the end of the fiscal year. Imagine that! A country making it more difficult to work when students want to work, young, and will spend that money on food, drink, fashion concerts etc etc

In 2021, about 1.6% (2 million) of Japan's population received public assistance.

it wasn’t long that we were reading stories about the bank of japan and pundits talking about the demise of japan from the dreaded “deflation spiral.”

this will change-nothing.

just keep in mind-money used are from our taxes.more money they will waste-more will ask to get from taxpayers.

this is NOT A GIFT.

ceding to a demand from an opposition party -- whose votes are needed for the ruling coalition, which lost its majority in last month's general election -- to pass the measures.

Get used to seeing this "reason" for spending more money, over the course of how ever long the LDP is "sharing" power.

Government: We are in huge debt but so are our people thanks to our poor handling of money. You know what we should do? We should take on more debt to help these folks take a break for a year while we worry about the future next year! Sounds like a great idea!

Someone sensible in the government: Wait, didn't we already do this before? Isn't this the reason why we got here in the first place?

Government: It's okay. I think we can actually start paying off the debt because we are able to boost our exporting and tourism industry thanks to our beloved weakening yen. We are making money baby!

Someone sensible in the government: Yes, but at what cost? You do understand we rely heavily on importing right? How do you think we get the materials needed to export goods elsewhere?

Government: It's gonna be fine. You worry too much.

SDCAToday  10:14 am JST

Someone sensible in the government: Wait, didn't we already do this before? Isn't this the reason why we got here in the first place?

Those who don't learn from history are doomed to repeat it...

We are talking about 65+ yo ojisantachi. They are working with the principles of 80ies, 90ies...

I'm part of the "Tax the Expat" movement and think the influx of tourists and expats is a great tax resource to get Japan back on economic track.

it wasn’t long that we were reading stories about the bank of japan and pundits talking about the demise of japan from the dreaded “deflation spiral.”

@Peter, I remember those days very well. Seemingly every relevant article on here contained a copy-paste line about how while deflation and cheaper goods may look good for consumers, it (somehow) causes them to put off purchases, slowing the economy down.

That nonsense was BOJ propaganda from the beginning. Anybody working for wages -- which is to say, the bottom 90% of society -- knows how much better things were when the yen was strong and prices didn't go up. An entire generation of young people were able to save and buy homes; older folks living off accumulated savings could maintain their lifestyle without putting their assets into risky investments.

Now the BOJ is getting what it always wanted, at the expense of the working class, who doesn't get a say in the matter.

LDP glorious past is over from decades,I credit them that since the end of WW2 they conributed in the so called "Japan miracle" but then the total absence of opposition made them completely detached from reality.

Good to have at the moment a stronger opposition which seems to care more about the welfare and social issues of the average people which are struggling to arrive at the end of the month.

More pressure from the opposition is expected to be made to the central government and push them to modernize a strict and outdates work culture and help the citizens.

Be careful what you wish for. Raising the tax threshold for being exempt from residence tax and qualifying for other benefits will only act to hit those in the low income brackets just above the new threshold. So low income earners who pay tax and health insurance will get another hit to their income.

Yes, the tax break will disproportionally help high earners who get the tax break on the most taxed part of their income, i.e., the top part not the bottom part. The drop in government income will mean less social spending on things like childcare and transport for old people, aka "austerity", so the net situation will be a loss across the group of people with less money.

Its also really stupid to call 1.03 million yen a "kabe (wall)" because it is merely a line. Cross the line and you pay a low tax rate on any extra (= nowhere near all) income. Your income will still go up if you earn 1 yen over.

This contrasts with the 1.3 million bona fine wall for married women who lose 300,000 yen a year if they earn 1 yen over that amount and lose spousal dependency under shakai hoken. This is a wall, not a line.

My guess is that the tax free allowance will not be raised above any of the spousal dependency walls. So maybe 1.2 or 1.3 million. Unmarried people do not have a choice to limit their income to below 1.03million yen because you cannot live on that amount. The tax line being there cannot be claimed to be a huge disincentive to work. People have to earn more than that just to live.

I wholeheartedly agree with Wick’s pencil

The handouts are peanuts and only one offs! Yet trillions are handed outside as aid!

Reducing the tax on food, which is already lower on average than the rest? That doesn't help much in this hyperinflation. If 5kg of rice were 2,500 yen and now cost 3,200 yen, you can't buy it in any case when having 2,500 yen in hand as before or even with a 10% wage increase, giving you 2,750 yen in the example. Whether the tax remains, is reduced or zero, and even if the government helps you with 10% price reduction present, you just can't buy those 5kg of rice with your little money. No, forget it, no one will help, not your employer and not the government. Those more generous eras are bygone.

These morons in government printing money and destroying our holdings. Genius.

Typical Keynesian economic nonsense. If the politicians actually want to help people (they don't), especially the low to middle income folk, the best solution would be to abolish both sales tax and income tax.

Why did they allow the energy companies to increase prices so much if they had to immediately inact price cuts and subsidies to offset them? The level of short term thinking leading to headaches is wild.

just reduce/exempt the tax on certain products, services and utilities.

Across the board, Japan is the most highly taxed country in the world, bar none.

Give subsidies to the low income and the poor.

Rise the salaries for the working people - they don't need peanuts !!!