Gov't not to set income cap for cash benefit plan

TOKYO, Nov. 11 Kyodo - The government and ruling coalition are finalizing a plan not to set a cap on
household income when determining qualification for a cash benefit program
under the government's new economic stimulus package, ruling coalition
lawmakers said Tuesday.
The government and coalition will compile a final draft Wednesday for ways to
implement the program without such a cap. Instead, high-income earners,
possibly those making 18 million yen or more a year, will be asked to
voluntarily refrain from receiving the benefit, they said.
As for the amount of payment, a broad consensus in the government and coalition
of the Liberal Democratic Party and New Komeito party is for the distribution
of 12,000 yen to each person except for those aged 18 or younger and those aged
65 or older, who will receive 20,000 yen.
Government officials as well as economic ministers had been divided over
whether the government should impose an income cap as part of the new cash
benefit program worth 2 trillion yen unveiled last month.
Economic and Fiscal Policy Minister Kaoru Yosano had expressed a positive view
regarding such a cap, but Finance Minister Shoichi Nakagawa said setting a
limit would require time-consuming and complicated preparatory procedures and
so would be unfavorable to stimulating the economy swiftly.
Yosano said Tuesday morning that he is now compiling a draft in line with Prime
Minister Taro Aso's call on high-income earners to decline the benefits.
''I understand (Prime Minister Aso's idea) and we are compiling a draft in line
with it,'' Yosano said at a regular news conference.
Aso expressed the view Monday that people with high incomes should voluntarily
refrain from receiving the benefits, saying, ''Setting an income cap (on people
eligible for the cash benefits) would involve a lot of trouble...it would be
easier'' if people earning a certain income voluntarily refrain from receiving
the benefits.
Aso said he will emphasize swiftness, convenience and fairness in implementing
the program, and that imposing an income cap would be troublesome because the
government would have to enact a law to do so.
Yosano said Tuesday such a cap would hamper swift implementation of the cash
benefits, referring to the massive amount of clerical work required that would
involve transferring tax payment information from the state to local
governments as well as the amendment of related laws.
Ichiro Ozawa, leader of the main opposition Democratic Party of Japan, blasted
the waiver system for wealthy people, telling reporters in Kobe, ''That is not
an appropriate system. Cash benefits will use taxpayers' money, so the
government should create a rational scheme.''
Ozawa criticized Aso for trying to ''distribute money before a (general)
election,'' which must be held before next September.
Taizo Nishimuro, head of an advisory panel to Nakagawa, welcomed the waiver
system for cash benefits, saying wealthy people should be given the choice of
whether to accept the money according to their conscience.
''Among rich people, some would think they do not need such benefits and others
would rather accept the money and quickly use it to help stimulate the
economy,'' said Nishimuro, who chairs the Fiscal System Council.
''The decision should be up to each person and I support the universal
provision of cash benefits. The government should not restrict payments to the
rich and should once again explain the original purpose of the measure,'' he
said. Nishimuro also serves as chairman of Tokyo Stock Exchange Group Inc.
The planned 2 trillion yen cash benefit program forms part of the government's
new stimulus package worth 26.9 trillion yen.
The prime minister said at a news conference on Oct. 30, held to unveil the
stimulus package, that the government would distribute the cash benefits to all
households by the end of March.
But Aso later mentioned the need to set an income cap for determining which
households should qualify, saying, ''There is no need for the benefits to be
extended to wealthy people.''
==Kyodo