Best News Network

Japan vows to stick to budget balancing goal despite defense boost

Article content

TOKYO — Japan must stick to its target of a primary budget surplus by the 2025 fiscal year, Finance Minister Shunichi Suzuki said on Friday, even as a planned increase in defense spending raises the specter of worsening already dire public finances.

“It’s true, that’s a lot of money” Suzuki said, referring to a plan for 43 trillion yen ($315.46 billion) in defense spending over the next five years.

Article content

“But we must stick to the aim of achieving a primary budget surplus by fiscal 2025,” Suzuki said when asked about how increased defense spending may affect Japan’s fiscal target.

Advertisement 2

Article content

Japan aims to achieve a primary budget surplus, excluding new bond sales and debt servicing costs, by the end of the 2025 fiscal year, in March 2026.

“Fiscal discipline must be maintained,” he added.

Prime Minster Fumio Kishida told ruling coalition tax chiefs on Thursday to work out a plan by the end of the year for increasing taxes to fund defense spending.

Kishida’s government is considering raising taxes in stages after fiscal 2023 and towards 2027 to help fund a plan to secure funding for the planned 43 trillion yen in defense spending for the five-year, mid-term defense plan.

After fiscal 2027, the government will need to earmark additional spending worth 4 trillion yen a year, of which some 1 trillion yen would be paid by tax increases.

Advertisement 3

Article content

“It’s important to gain consent from the public as we are going to ask them to shoulder the burden,” Suzuki said.

He brushed aside the possibility of issuing additional debt.

“It’s difficult to consider debt issuance as stable sources of funding strengthened defense capabilities over time,” he said.

Instead, the government would focus on reforming spending and tapping unused budget and non-tax revenue, and put them together in a pool of funds for strengthening defense.

Kishida has announced plans to lift defense spending to an amount equivalent of 2% of gross domestic product within five years, from 1% now. ($1 = 136.3100 yen) (Reporting by Tetsushi Kajimoto; Editing by Edmund Klamann, Robert Birsel)

Advertisement

Comments

Postmedia is committed to maintaining a lively but civil forum for discussion and encourage all readers to share their views on our articles. Comments may take up to an hour for moderation before appearing on the site. We ask you to keep your comments relevant and respectful. We have enabled email notifications—you will now receive an email if you receive a reply to your comment, there is an update to a comment thread you follow or if a user you follow comments. Visit our Community Guidelines for more information and details on how to adjust your email settings.

Stay connected with us on social media platform for instant update click here to join our  Twitter, & Facebook

We are now on Telegram. Click here to join our channel (@TechiUpdate) and stay updated with the latest Technology headlines.

For all the latest Business News Click Here 

 For the latest news and updates, follow us on Google News

Read original article here

Denial of responsibility! NewsAzi is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.