The government will take a cautious look at including substantial cuts or exemptions in the gift tax when crafting additional economic stimulus measures because such measures may only benefit wealthy people, Chief Cabinet Secretary Takeo Kawamura said Monday.
"It is very important to consider how to create demand by utilizing financial assets held by the elderly," Kawamura said, referring to Prime Minister Taro Aso's remarks Saturday that the government will consider cutting the gift tax to stimulate consumption.
"Meanwhile, we need to respond cautiously, in part because there is a view that the measure would only benefit people with considerable assets," Kawamura added.
He said the government will take into account discussions by tax panels of the ruling parties and the government.
Aso is expected to instruct Finance Minister Kaoru Yosano on Tuesday to work out the economic package, which will be financed by the fiscal 2009 supplementary budget.
Liberal Democratic Party lawmakers have proposed upping basic deductions under the gift tax to ¥25 million a year from the current ¥1.1 million.