The government pledged Thursday to simultaneously achieve fiscal rehabilitation and economic growth in a draft of its longer-term economic and fiscal policy blueprints but gave no details on how to pave the way for sound public finance.
Prime Minister Shinzo Abe’s administration promised in the draft to halve the ratio of the primary balance deficit to the country’s gross domestic product by fiscal 2015 from the level in fiscal 2010 and turn the balance into a surplus by fiscal 2020.
It also committed to reducing the ratio of Japan’s public debt to GDP from fiscal 2021 “in a stable manner,” to prevent a growing concern over the nation’s fiscal health from rattling the sovereign debt market and prompting a spike in long-term interest rates.
As for the planned sales tax hikes in two stages to 10 percent from the current 5 percent by 2015, the draft said the government will make a judgment this autumn on whether to carry out the hikes, while taking into consideration economic conditions across the board.
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