Aso Cabinet E-mail Magazine No.5 (November 6, 2008) ================================================================
"Measures to Counter Difficulties in People's Daily Lives"
The Government has decided on a package of economic countermeasures to assist the Japanese people -- Measures to Counter Difficulties in People's Daily Lives.
The purpose of these measures is to remove the fears among ordinary people concerning their daily lives -- that is, to ensure the "security of the Japanese people in their daily lives" in the midst of the global financial crisis. What is important is to act with speed, focusing on selected areas of emphasis, with no pork-barrel handouts. These measures are ones of unprecedented boldness.
First, we will provide stipends as an emergency measure to support households. The total scale will be around two trillion yen; a four-person household would receive around 60,000 yen. We will arrange for these stipends to be dispensed as soon as possible. Employment insurance fees will be reduced. We must increase the net income receipts of working people. We will assist the efforts of businesses to employ older "freeters" (irregular and part-time or casual employees), known as the "lost generation," as regular employees.
The maximum level of lending and credits for micro-, small and medium-sized companies, for which nine trillion yen was allocated in the supplementary budget, will be raised to 30 trillion yen. This is to make their cash flow more secure as we head toward the end of the calendar year.
Highway tolls will be reduced substantially so as to enable the latent potential of the regions to be fulfilled. On weekends and holidays, tolls will be 1,000 yen or less, regardless of the distance traveled. On weekdays too, daytime tolls will be reduced by 30%. In addition, in the event of the reallocation of the tax revenues earmarked for road projects to general purposes, one trillion yen will be made available for the regions to use with discretion.
We will implement these measures as soon as possible, in sequence.
Deficit-financing bonds shall not be issued for these economic countermeasures. However, Japan's government finances continue to run a substantial deficit, and yet in the years to come, our social security costs will also increase. I am sure that the people of Japan feel significant unease regarding this situation.
I will summarize and present to the Japanese public by the end of 2008 a Mid-term Program on Government Finances -- that is, future principles concerning government revenues and expenditures.
The basic idea of this program is as follows. During the period of economic recovery, taxes shall be reduced for a limited duration. The top priority is to revive business activity. After the economic situation has improved, fundamental reform of the tax system, including the consumption tax, shall be launched, so as to ensure social security that enables peace of mind.
Specifically, I should like to ask for an increase of the consumption tax after three years, with a basic premise being eliminating government waste and after taking into account the economic situation at that time.
It is simply impossible to continue having a low level of burden-sharing while enjoying social welfare of a mid-level. Tax increases are unpleasant for everyone. However, we must not accumulate substantial debt for our children to repay.
I consider this to be a political responsibility.
The global economy is being buffeted by a once-in-a-century storm, but this is no reason for us to feel daunted. And neither should we merely choose to lie low till the typhoon passes.
Countries around the world are now set to take coordinated actions and to proceed with their own measures to the maximum extent possible in the face of this difficult situation. These require deft handling at the helm of government. Japan, too, will take on these challenges by mobilizing the full powers of the Government.
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