Japan govt submits budget plan as Diet starts 150-day session

January 28, 2019

Tokyo--The government submitted to the Diet, Japan's parliament, its fiscal 2019 draft budget with general-account spending at a record 101,457.1 billion yen on Monday, as the Diet started a 150-day ordinary session the same day.

The fiscal 2019 initial budget, including funds for stimulus measures to cope with the impact of a consumption tax hike scheduled for October, will be the first to exceed 100 trillion yen, with both defense and social security outlays hitting new record highs.

"We'll have the last Diet session of the Heisei era," which will end with Emperor Akihito's abdication on April 30, Prime Minister Shinzo Abe told reporters in the morning.

"And also, it'll be a session to usher in a new era. We'll respond to the people's expectations by working for an early enactment of the budget, as well as important legislation including for free-of-charge education," Abe said.

The government aims to get the fiscal 2019 budget through the Diet by the end of March.

The government adopted a budget plan for the fiscal year starting in April at a cabinet meeting late last year, but repeated the adoption process earlier this month following revisions to jobless benefits and other spending items affected by the revelation of irregularities in a key labor survey. It is unusual for a cabinet-cleared budget to be revised.

On Monday, the government also submitted a second fiscal 2018 supplementary budget plan totaling 2,709.7 billion yen, including 1,072.3 billion yen for disaster prevention measures such as those on rivers and roads, in the wake of a series of major natural disasters that hit the country last year.

The extra budget will also finance agriculture-strengthening measures worth 325.6 billion yen, after the 11-member Trans-Pacific Partnership free trade pact came into force late last year.

In the fiscal 2019 budget bill, funds allocated for stimulus measures related to the consumption tax hike total 2,028 billion yen, including 279.8 billion yen for a program to give shopping rebates of up to 5 pct of cashless payments at small retailers and 172.3 billion yen for discount vouchers for low-income and child-rearing families.

Spending on projects to increase the disaster resilience of key infrastructures comes to 1,347.5 billion yen.

Meanwhile, annual tax revenues are also estimated to reach a record high, at 62,495 billion yen, surpassing the bubble-era peak, thanks to economic improvements and the planned tax hike.

As over 30 pct of annual spending will remain funded by the issuance of government bonds, however, opposition parties are poised to grill the government for a lack of fiscal discipline. Jiji Press