The Finance Ministry rejected the glum assessment of the Japanese economy presented Friday in a report by the International Monetary Fund, saying the government has taken sufficient steps to revive the economy.
Senior ministry officials pointed to such measures as permanent tax cuts expected to be worth roughly 7 trillion yen and guidelines for the next state budget that focus on economic recovery.
Thus, they maintain the pieces are in place for an economic turnaround. The ministry also said it has no intention of reducing the consumption tax from the current 5 percent, given the decline in tax revenue due to the prolonged slump in the economy.
Prime Minister Keizo Obuchi responded in Diet debate that such an issue is not an option.
As for increasing the capital capacity of the nation’s financial institutions, ministry officials said sufficient measures have been taken by providing the Deposit Insurance Corp. with 13 trillion yen for that purpose.
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