Japan seen reaping record tax revenue in fiscal 2024, sources say

TOKYO :Japan's tax revenues are likely to hit a record high for a fifth straight year in the current fiscal year ending in March 2025, four government sources told Reuters.

The government will tap the additional revenues to fund part of a 13.9 trillion yen ($91.7 billion) spending package aimed at cushioning the blow to households from rising living costs.

It will also issue new government debt exceeding 6 trillion yen, the sources said, declining to be identified because the information is not public.

Total nominal tax revenues for the current fiscal year, initially estimated at 69.6 trillion yen, will likely increase to around 73.4 trillion yen due to robust corporate profits and rising inflation, they added.

Prime Minister Shigeru Ishiba announced last week a plan to compile the spending package, which includes fuel subsidies and payouts to low-income households to deal with increasing prices.

The government is expected to finalise on Friday a supplementary budget for the current fiscal year to fund the stimulus measures.

Unlike other advanced nations that had phased out crisis-mode stimulus, Japan continues to compile big-spending packages to underpin a fragile economic recovery.

Including debt issued to roll over maturing bonds, the outstanding balance of Japanese government bonds (JGB) has ballooned to 1,100 trillion yen - twice the size of Japan's economy and the largest among advanced nations.

($1 = 151.5400 yen)