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A bill for revision of the fiscal reform law was passed in the Lower House on Friday, bringing an economic stimulus package worth more than 16 trillion yen one step closer to implementation.

The bill is expected to become law by the end of this month after being passed in the Upper House.

The Fiscal Structure Reform Law, enacted only last November, obliges the government to reduce the fiscal deficit to 3 percent or less of gross domestic product by fiscal 2003 and terminate the issue of deficit-covering bonds by the same year.

The revision would postpone the target year from fiscal 2003 to 2005 and would forgo capping social security spending for fiscal 1999.

The fiscal 1998 supplementary budget, with actual spending worth 6.1 trillion yen including tax cuts, would be financed by issuing 2 trillion yen in deficit-covering bonds and 4.1 trillion yen in construction bonds. The extra budget is expected to pass the Diet next month.

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