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Japan's Cabinet Approves $53 Billion Stimulus

Passersby walk past stock quotation board outside brokerage, Tokyo, Dec. 4, 2013.
Japan's Cabinet has approved a $53 billion stimulus package to help offset the effects of an upcoming national sales tax hike.

The stimulus spending measure passed Thursday is part of a supplementary budget for Japan's current fiscal year.

The package, which must be approved by parliament, is intended to create 250,000 jobs. It includes steps to boost construction spending and help low income households.

In April, Japan will raise its consumer sales tax from 5 percent to 8 percent to help pay for rising social security costs and deal with one of the industrial world's largest national debts.

But while the controversial tax increase will raise an estimated $81 billion a year, some fear the plan will hurt consumer demand and damage Japan's fragile economic growth.

Massive stimulus spending is a key part of Prime Minister Shinzo Abe's economic plan, known as Abenomics. Abe's plan also involves aggressive efforts to increase the amount of money circulating in Japan's economy to help fight lowering consumer prices, and other reforms to the country's economic system.

Some information for this report was provided by AP and Reuters.