May 20, 2022
Japanese Prime Minister Fuio Kishida

The Japanese government plans to increase the cap for gasoline subsidies and announce additional budget to cushion the economic impact of rising raw material costs, according to a draft of its planned relief package.

The package will include most of the proposals made by the government yesterday, such as cash payments to low-income families struggling with a rising cost of living.

The government has also pledged another “comprehensive” package of measures to boost the economy in June, after decisions have been made over long-term economic and fiscal policy, according to the draft.

As a net importer of oil and gas, Japan’s economy has been put under pressure by rising fuel costs in particular, with rising costs for other raw materials and the inflationary effect of recent yen declines also having an impact.

Prime Minister Fumio Kishida has been under pressure to do more to protect households and businesses from rising costs, and the draft acknowledges this with proposals to soften the blow for consumers and retailers alike.

“The government must be vigilant to the impact recent yen falls could have on households and importers,” said the draft, which is expected to be confirmed by Kishida’s administration next week.