In order to restore the country’s strong economy, the Upper House on Thursday passed a record 95.88 trillion yen (US$937 billion) budget for next fiscal year. This is the biggest ever approved budget and is expected to help the country brace for the upcoming sales tax increase, which will be its first in more than 15 years.
Out of the 242 members of the Upper House, 136 voted in favor of the budget, while 102 opposed it, 2 abstained and 1 is a vacant seat. Last month, the Lower House also approved the proposed budget, which is 92.61 trillion yen more than the current fiscal year’s budget. The increase is needed to pay for the steadily increasing health and social welfare costs, as the country’s population continues to age while the birth rate continues to stay alarmingly low.
Japan’s Prime Minister Shinzo Abe told reporters afterwards, “The most important policy of the Abe government has been and will be to restore a strong economy.” He emphasized that what they’re aiming for in this next fiscal year is to “minimise the negative impact” of the 8% increase in the sales tax, from the current 5%, which has been the case since the 90s. The increase is needed to bring down Japan’s national debt, which is far too high for the world’s third largest economy. Abe also emphasized that both the sales increase and the record national budget are needed to bring the country out of years of deflation. “With the passage of the budget, we showed to people at home and abroad a strong determination on the part of our parliament to end deflation,” he said.
[ via ABC ]