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Politics

Japan lawmakers weigh record stimulus amid pandemic

Ruling and opposition parties weigh cash for families and consumption tax break

Japanese lawmakers hope to persuade consumers to spend as the coronavirus outbreak throttles back demand.   © Reuters

TOKYO -- Representatives from Japan's government, ruling coalition and opposition parties met Thursday to discuss what would be a record-breaking stimulus to deal with the new coronavirus, though details remain up in the air.

Meeting with Prime Minister Shinzo Abe's Liberal Democratic Party and coalition partner Komeito, the country's five largest opposition parties called for helping low-income families, securing equipment and disinfectant for hospitals, and expanding testing.

Tokyo looks to assemble a package of emergency measures as early as April. "We want to hear various opinions from the ruling parties and the opposition," said Deputy Chief Cabinet Secretary Akihiro Nishimura, attending on behalf of the government.

The group is slated to meet once a week until the outbreak is under control. "Communication among the ruling and opposition parties is important," said Hiroshi Moriyama, who chairs the LDP's parliamentary affairs committee. "I hope this will lead to dynamic discussion."

The LDP plans to canvass party members and present recommendations to the government this month. Abe will officially direct lawmakers to put together a stimulus package after the fiscal 2020 draft budget passes as early as March 27.

LDP members have called for an even larger stimulus than the 26 trillion yen ($241 billion) package announced in December. There has also been a push for support for households with children, including cash payments.

Komeito favors direct assistance to households, such as cash or vouchers, and expanded subsidies to help businesses keep workers employed.

Opposition parties differed on their preferred combinations of spending and tax breaks. The Constitutional Democratic Party, the country's largest opposition party, is focused on help for low-income households. Party leader Yukio Edano said the Constitutional Democrats will "consider all options" but are leery of a consumption tax cut, which would take time to implement.

The Democratic Party for the People has proposed a 30 trillion yen emergency package that features payments of 100,000 yen, or nearly $1,000, to each citizen, as well as temporarily halving the 10% consumption tax to 5%.

The more conservative Nippon Ishin no Kai, or Japan Innovation Party, instead recommended expanding the reduced consumption tax rate of 8% on certain items, such as food, to all products.

Opposition representatives also urged the government to provide compensation for economic losses caused by its recommendations to cancel events and close schools.

Members of the opposition see this forum as a valuable opportunity to participate in shaping policy. "We want [the government] to not just hear views from the opposition, but to sincerely respond to them," said Seiji Osaka, policy chief of the Constitutional Democrats.

But ruling party lawmakers worry that taking suggestions from their political foes would enable the latter to score points with the public for helping to handle the crisis.

Norihisa Tamura, head of the LDP's coronavirus countermeasures group, stressed that the meeting is a forum to discuss policy recommendations, not to make decisions.

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