National / Politics

Abe eyes economic package to assist recovery from typhoons and offset tax hike

JIJI

Prime Minister Shinzo Abe is poised to instruct his staff to draw up a package of measures in response to a recent spate of massive natural disasters and to rev up the nation’s economy after a consumption tax hike a month ago.

The details will be discussed over the course of the government’s budget compilation work later this year, informed sources said. The measures will be included in a supplementary budget for fiscal 2019, which ends in March, and the full fiscal 2020 budget, sources said Friday.

The package could be worth as much as about ¥5 trillion, people familiar with the matter said.

With the planned package, the first by the government since August 2016, taken into consideration, the government’s fiscal 2020 general-account budget is seen topping ¥100 trillion, after its fiscal 2019 full budget exceeded that threshold.

Disaster-related measures will be a centerpiece of the coming package, sources said. After levees broke at a number of rivers in eastern and central Japan due to Typhoon Hagibis in mid-October, the government plans to strengthen river embankments and dams across the country.

The government will also work out measures to support the agriculture, forestry and fishery sectors, which have been hit hard by the typhoon, the sources said. Damage to the industries from Hagibis, the 19th named storm of the year, has surpassed ¥100 billion.

“We’ll come up with a package to help rebuild” the lives of people affected by recent disasters, Abe told a meeting of the government’s disaster-response headquarters on Friday.

The government is reviewing the state of the economy following the Oct. 1 consumption tax hike to 10 percent from 8 percent.

It has implemented measures to cushion the impact of the tax increase, such as a program to give reward points to shoppers making cashless payments mainly at small shops and gift certificates with “premium” coupons. But concerns persist about overseas economies amid the U.S.-China trade war and other uncertainties.

In response to concern that a pool of funds currently earmarked for the reward point program may run out, the government will consider allocating more financial resources for the initiative, the sources said.

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