Japan’s parliament enacted a 3.12 trillion yen ($26.61 billion) extra budget for fiscal 2014 Tuesday to fund an economic stimulus package aimed at boosting domestic demand aggravated by last year’s consumption tax hike and the yen’s plunge.
The budget for the fiscal year through March 31 was approved in the House of Councillors with a majority vote led by Prime Minister Shinzo Abe’s ruling Liberal Democratic Party and its junior coalition partner Komeito party.
Under the budget, the government will allocate 1.19 trillion yen to provide subsidies to alleviate the negative impact of higher prices and allow municipalities to implement measures to shore up their economies at their own discretion.
In a bid to invigorate sluggish private spending, Abe’s administration will also work to empower women in society, issue regional merchandise coupons and carry out steps to encourage people to relocate to rural areas.
With the housing market weakening, the government will resume the so-called “housing eco-point” incentive program that grants points to people in Japan who construct or refurbish homes with eco-friendly features.
The points are exchangeable for a range of eco-friendly products or gift coupons.
Since taking office in December 2012, Abe has made efforts to help boost the profitability of export-oriented manufacturers and lift Japanese stock prices by his economic policies entailing aggressive monetary easing and massive public spending.
But criticism has been growing that the “Abenomics” policy mix has only benefited big companies and people in large cities, with Abe being urged to expand support for local economies and lower-income earners.