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Saturday, Oct. 29, 2011

DPJ aiming to get ¥12.1 trillion package through Diet by mid-November to speed rebuilding

Noda seeks public support for tax hike

Staff writer

Prime Minister Yoshihiko Noda sought Friday to win the public's acceptance of a temporary tax hike to pay for the third disaster reconstruction budget.

News photo
Tough sell: Prime Minister Yoshihiko Noda delivers a policy speech during the plenary session of the Lower House Friday. KYODO

The Democratic Party of Japan is aiming to get the ¥12.1 trillion package through the Diet by mid-November to speed up rebuilding following the devastating March 11 catastrophe.

In a policy speech to the Diet following the administration's submission of the supplementary budget, Noda vowed to make efforts to cut spending and sell off government-owned assets, including shares in Japan Post and Japan Tobacco.

But he argued that a tax hike is also necessary to prevent future generations from being burdened with snowballing debt.

"The proposal on financial resources for reconstruction stipulates that we will ask citizens to bear a certain financial burden by temporarily raising core taxes, including income tax, corporate tax and resident tax. The background to this is the harsh situation of national finances," Noda said.

He also expressed his intention to establish high-level economic cooperation with various countries and regions, including South Korea, Australia and the European Union, as well as coming to a conclusion over whether to join talks on the Trans-Pacific Partnership agreement.

Discussions on the TPP regional free-trade framework, which would eliminate all tariffs in 10 years among member states without exception, has triggered a harsh battle between Japanese supporters and opponents.

Nine countries, including the U.S. and Australia, are already in negotiations and Noda is expected to make a decision before next month's summit of the Asia-Pacific Economic Cooperation forum.

"Japan will continue to engage in serious discussions on the participation in negotiations for the TPP agreement and will reach a conclusion at the earliest stage possible," he said.

Noda pledged to come up with a mid- to long-term "national vision" to review energy strategy and cut dependence on nuclear power "to the maximum."

The prime minister also recalled the "carefree smiles" of the children of Fukushima who told him they wanted to play outside. Reiterating his firm resolution to bring the nuclear crisis at the Fukushima No. 1 plant to a conclusion and to clean up the contaminated area, Noda said he will set up a fund to revitalize Fukushima and build an international medical center for radiation treatment.

"An urgent and pressing challenge is to engage in thorough decontamination operations in the various areas affected," Noda said. "The entire government will work to prepare a response structure, taking responsibility for gaining an accurate understanding of the situation and implementing large-scale decontamination operations as we work to eliminate the worries and concerns of the local residents and the public as a whole as soon as possible."

About ¥9.24 trillion of the spending package will be used for reconstruction work, including ¥1.56 trillion in grants for local governments in the Tohoku region. The extra budget also includes ¥355.8 billion to deal with the nuclear disaster, ¥245.9 billion of which will be earmarked for decontamination work.

Diet gets extra budget


The government on Friday submitted to the Diet a draft ¥12.10 trillion spending package that would finance quake and tsunami reconstruction in the northeast.

The third extra budget for fiscal 2011 would also finance emergency programs to ease the negative impact on the economy from the yen's recent sharp rise against the dollar and other major currencies.

At the same time, the government submitted related bills for Diet deliberations, including one to raise some taxes temporarily and secure ¥11.20 trillion for servicing special government bonds and other purposes.

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The Japan Times

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