Japan's Government Considers New Stimulus Package to Offset Sales Tax Increase

Forex News

Japan's government plans to adopt a stimulus package worth around 10 trillion yen ($87.87 billion) to offset the impact of a sales tax hike next year and to increase public works spending after a series of natural disasters.

The government would raise the consumption tax from 8% to 10% in October next year. The tax hike has already been postponed twice owing to jitters over how it might affect consumption. The last consumption tax increase, in 2014, sparked a recession.

The government is also leaning toward spending more on infrastructure and disaster prevention as some officials grow worried about the need for something to offset growing global risks. Some of the funds would go toward measures previously announced, such as tax breaks for car purchases and shopping vouchers to help low-income households.