Japanese government considering cash benefits for households facing drop in income due to coronavirus
As part of an economic stimulus package to be compiled in early April, the government is considering including a plan to provide cash to households facing income drops due to impacts from the outbreak of the new coronavirus, informed sources have said.
The size of the stimulus package is likely to balloon, as some ruling bloc lawmakers are calling for more measures now that the tourism and retail industries are seen suffering a slump in earnings because of the postponement of the 2020 Tokyo Olympics and Paralympics, the sources said.
The economic package is projected to total over ¥30 trillion. Combined with the ¥26 trillion stimulus package drawn up late last year, the economic steps implemented and planned by the government this time could outpace the measures worth ¥56.8 trillion compiled to deal with the 2008-09 global financial crisis.
The government is slated to compile a fiscal 2020 supplementary budget to cover costs for the stimulus measures.
As an increasing number of businesses are being forced to suspend operations due to fallout from the coronavirus outbreak, “enough cash benefits should be provided to people really in need,” a government official said, suggesting that the planned cash program will not cover all households. The government plans to start offering cash benefits in May at the earliest.
Due to the postponement of the Tokyo Games, it is now all but certain that the government will miss its target of increasing the number of visitors to Japan this year to 40 million.
Some people even started calling on the government to draw up a second supplementary budget for fiscal 2020 in order to support the hotel and transportation industries, which are highly likely to be hit hard by the postponement of the Tokyo Games.
The government and the ruling camp, led by the Liberal Democratic Party, are considering issuing shopping vouchers that can only be used during a limited period for tourism and events, in a bid to ease the economic impacts of Tokyo Games postponement.
With the shopping vouchers and other measures, the government and the ruling coalition aim to stem the drop in inbound travel demand and revive the domestic tourism industry after the coronavirus crisis is brought under control, sources said.