Japan considers paying low-income workers ¥5,000 through benefit program

The Japanese government said Friday that it is considering providing around ¥5,000 a year to low-income workers under a proposed income-linked benefit program.

Under the program, a fixed amount is expected to be given to people in work who earn ¥1.19 million or less annually. The government expects the amount to gradually increase until the annual income reaches ¥1.6 million. The benefits will decrease gradually after the annual income exceeds a certain level.

The plan was outlined in documents submitted by the government at a board meeting of the Financial Affairs Committee of the House of Representatives, the lower chamber of parliament.

The committee is discussing bills aimed at reducing the 8% consumption tax on food to 1% for a two-year period starting next April and introducing the benefit program.

The government plans to provide ¥600 billion in benefits a year in total, a figure equivalent to 1% of the consumption tax.

Noting that the ¥600 billion amounts to ¥5,000 per capita by simple calculation, the government said in the documents that it will consider the amount of benefits for low-income earners using the figure as a reference.

The government has also put forward an estimate that the average amount of benefits will be ¥30,000 if about 20 million people with an annual income of 1 million to ¥3.5 million are eligible for them.

Finance Minister Satsuki Katayama has stressed that these figures are for reference only and that the government has not presented its proposals.