Refusing to cut taxes, Japan’s ruling party plans cash handouts to struggling populace

Japan’s prime minister, Shigeru Ishiba, and his ruling Liberal Democratic Party (LDP) are revving up the Keynesian credit machine for cash handouts, ahead of an Upper House election next month. Opponents have criticized the plan in the past, calling for tax cuts and more sensible spending, but Ishiba and crew will instead keep shaking down the struggling Japanese public and toss a few crumbs from the table.  According to local media, Japan’s LDP ruling coalition will be handing out cash if it holds sway in the next Upper House election next month. During a June 10 meeting in Tokyo, secretaries-general and coalition officials reportedly decided to move forward on discussing exact amounts and details of the handouts. The plan was shot down back in April and criticized as an irresponsible measure, with DPP secretary general Kazuya Shinba saying at the time:

“If the government doles out taxpayers’ money in the form of benefits, there is no point in collecting it from the public in the first place.”

Self-proclaimed “defense geek” Ishiba has come under fire for refusing to cut consumption tax as rice prices soar, and the Japanese yen continues to struggle. Ishiba’s willingness to dole out vast sums of money to the U.S. government and on military spending is also a reason for Japan’s residents to resent the policy.

Japan government’s spending spin cycle

The handouts are expected to be tossed out in the form of cash or via the embattled “My Number” system (a new catch-all national ID system some nationals are fighting against adopting). As far as amounts, the Asahi Shimbun reports that ¥50,000 per person (~$345) was discussed in April, and coalition officials are mulling not setting limits based on income. The plan could be funded using a “surplus” from 2024 taxes, and has forced junior coalition party Komeito to drop its tax cut plans ahead of next month’s vote, expected to take place on July 20. While the coalition wants to sway the public and garner votes by giving away money, public opinion polls have showed “strong opposition” to the idea, according to Asahi. Other issues Japanese have been vocal about include massive inbound tourism, resulting in skyrocketing hotel prices and damage to property, inadequate pensions for the elderly, and a rice shortage which some farmers claim is a direct result of state-created limits on production. It is not clear whether a paltry ¥50,000 per person would do much at all to alleviate the economic fallout on the archipelago, but it seems many have their doubts.

Cryptopolitan Academy: Want to grow your money in 2025? Learn how to do it with DeFi in our upcoming webclass. Save Your Spot