Providing consumers with merchandise coupons in an effort to stimulate personal consumption will be studied as a possible measure for the second fiscal 1998 supplementary budget, government officials said Thursday.Chief Cabinet Secretary Hiromu Nonaka confirmed during a morning news conference that such a plan was being reviewed.Prior to Nonaka’s remarks, Finance Minister Kiichi Miyazawa acknowledged during an extraordinary meeting of the Cabinet’s economic ministers that he has instructed his ministry to look into the coupon scheme. The ministers present endorsed the action, participants said.The plan calls for giving consumers a coupon with a specific value that would be valid for a set period of time. The coupon would benefit all households, including those in lower income brackets who cannot enjoy tax reductions.The unprecedented project is based on a proposal initially suggested by the opposition party Komei, which maintained that the usual pump-priming step of income tax cuts would not encourage consumers to loosen purse strings at a time when prospects of secure employment and ample savings for retirement are growing unclear.Vice Finance Minister Koji Tanami said Thursday that the ministry will study problems related to the plan of providing gift coupons to consumers as a tax cut measure.The Finance Ministry has yet to consider how to implement the plan, Tanami told reporters. He also said it is difficult to decide who will issue coupons and who will implement the plan.On Tuesday, Komei presented to the Diet its bill for distributing a merchandise coupon worth 30,000 yen to each person next year. If the idea is incorporated into the next extra budget, the coupons could be distributed as early as January, according to government sources. Nonaka said it would not be necessary for leaders of the Liberal Democratic Party and Komei to meet to discuss the gift certificate issue.Prime Minister Keizo Obuchi has said the government should consider steps that take into account that lower income earners would not greatly benefit from already proposed tax cuts, and the coupon matter should be considered in this context, Nonaka said.
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