Japan's Cabinet gives nod to record budget

JAPAN'S CABINET APPROVED a record ¥115.5 trillion ($732 billion) budget for the fiscal year starting April 2025, setting up the minority government of Prime Minister Shigeru Ishiba for a key test of its longevity in getting the proposal approved by parliament.

- ERICA YOKOYAMA & ALASTAIR GALE

The budget plan detailed Friday marks a 2.6% increase from the current year, and would be partly funded by a record ¥78.4 trillion in tax receipts, enabling a 19% reduction in new bond issuance.

Since losing its lower house majority in an October election, Ishiba's coalition government has been forced to negotiate with opposition parties over policy plans.

In order to win the support of the small Democratic Party for the People to pass an economic stimulus package, the coalition agreed to raise a ceiling on tax-free income during the annual tax reform process.