Social security measures using consumption tax hike revenue drafted


The government has drawn up measures that will be implemented in fiscal 2015 to better support families with children and improve social welfare services using a revenue increase as a result of the consumption tax rate hike last April, it was learned Sunday.

The government expects that the 3 percentage-point tax hike will increase consumption tax revenue for fiscal 2015, starting April 1, by ¥8.2 trillion.

Of the total, about ¥1.35 trillion will be used for these measures, with the remaining amount to be spent for existing social security programs and to cover the government’s contribution to basic pension programs, informed sources said.

In addition, the government plans to use some ¥140 billion resulting mainly from a planned hike from August in out-of-pocket expenses by recipients of nursing care services for the elderly, the sources said.

Some ¥510 billion will be spent on measures to support child-rearing households although the government has decided to put off an additional consumption tax hike, from the current 8 percent to 10 percent, until April 2017 from the originally planned October this year, the sources said.

The measures include the construction of more nursery schools as part of efforts to reduce the number of children waiting to enter such facilities to zero as well as a hike in pay levels for nursery teachers.

The government will also expand financial assistance for a financially strapped health insurance program for self-employed people and others, the sources said.

Meanwhile, the government will push back the distribution of an add-on benefit of ¥5,000 per month per head to elderly people with low levels of pensions, following the postponement of the additional consumption tax hike, the sources said. The add-on pension will be introduced in April 2017, the sources said.