Japan has approved a draft budget for the fiscal 2014 starting in April. The sum is making a balance between increasing growth and showing the budget is keen to rein in public debt, which is two times bigger the size of Japan’s economy.
“The new budget needs to confront not only the task of economic revival, but also that of fiscal reconstruction. The issuance of government bonds will also be steadily decreased as we emphasize future investments and improving people’s safety nets,” said Yoshihide Suga, Japanese Chief Cabinet Secretary.
Japan’s total spending will rise more than Y3 trillion compared to last year’s budget to a record-high of Y95.9 trillion or $920 billion. Around a third of the sum will be spent on social security, while another third will be saved for debt servicing costs, according to the international press.
Military costs will climb 2.8 percent toY4.88 trillion, the biggest increase in the defense budget in 18 years. Tax revenue is estimated to increase to a seven-year high at around 50 trillion yen. Analysts say that indicates a boost from an increase in the sales tax this year.