The ruling Liberal Democratic Party unveiled its campaign promises for the upcoming Upper House election Thursday, focusing on cash handouts of ¥20,000 ($137) for everyone and ¥40,000 for children and low-income earners.

The party also pledged to increase the nation’s gross domestic product to ¥1 quadrillion from the current ¥600 trillion and boost average income by 50%, both by 2040. “Driving Japan forward, enriching lives” will be the party’s campaign slogan.

“In the face of challenges such as rising prices and the impact of U.S. tariffs, people tend to be defensive,” LDP policy chief Itsunori Onodera told a news conference on Thursday, "but we decided to go back to the original mission of politics, which is enriching lives.”

A decline in real wages prompted the party to consider concrete measures to address the ongoing cost-of-living crisis, Onodera added.

The content of the campaign promises has been the focus of intense debate in the party over the last few months, such as whether to prioritize cash handouts or tax cuts.

Cash handouts were initially favored by party executives, but a significant number of party members demanded something more drastic, such as a tax cut. The party’s coalition partner, Komeito, advocated for cash handouts first, followed by a consumption tax cut.

Prime Minister Shigeru Ishiba, who serves as LDP president, initially considered a tax cut, but then settled on one-off cash handouts strongly backed by LDP Secretary-General Hiroshi Moriyama, the party’s No. 2 man.

The party’s pledges are in sharp contrast to those of the opposition parties, which have all promised tax cuts in various degrees. The LDP is hoping that prioritizing fiscal health will pay off at the polls.

“While a consumption tax cut may seem like a good idea at first glance, in reality it offers little support to low-income individuals and tends to benefit high-income earners more,” Onodera pointed out.

Measures to control the price of gasoline and strengthen regulations concerning foreign residents were also included in the campaign promises.

Campaigning for the election is expected to start on July 3, with voting slated for July 20.

Of the 248 seats in the Upper House, half of them will be facing election in July, with 125 seats being the majority threshold. The LDP and its junior coalition partner currently have 140-seats in the chamber, of which 66 seats will be up for grabs. With 74 ruling coalition seats not facing election this time, it needs 51 seats or more in the July election to maintain the majority.