TOKYO, Oct. 16 (UPI) -- The Japanese government, exceeding earlier pledged spending limits, announced plans Tuesday for $16.6 billion extra in the budget to help shore up the foundering Japanese economy.
The government of Prime Minister Junichiro Koizumi was forced to retreat from a vow to hold spending to a lower level, because of the continued poor state of the economy.
According to a statement from the Finance Ministry, the main thrust in spending will be toward economic structural reforms, including labor market reforms and the promotion of information technology. The government hopes to entreat workers in declining old-economy industries to migrate to newer growth sectors.
Because of expected tax revenue shortfalls, the increase in spending breaks an earlier pledge by Koizumi to curb government debt by holding the line on spending.
The Finance Ministry, however, said that government will continue its efforts to cap new bond issues below the $273 billion target ceiling for fiscal 2001-02 and fiscal 2002-03
The Finance Ministry earlier announced that tax revenues for the current fiscal year -- ending in March - will come in about $9.11 billion below estimates of around $475 billion, mainly as a result of a shortfall in corporate taxes because of the slowed economy.