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Financial Crisis Action Plan

Provisional Translation


DPJ Policy Research Committee Chair

Masayuki Naoshima


In order to respond to the financial crisis that originated in the US and the ongoing rapid deterioration in the real economy, the DPJ will submit the following bills to the current Diet session and aim to pass these bills as quickly as possible



December 3, 2008
DPJ Next Cabinet

[DPJ] Economic Stimulus Related Bills

1. Economic Stimulus Measures to Protect People's Livelihoods (Measures to expand domestic-demands)

(1) 

"Child Allowance" bill (for submission to the current Diet session) [Next Minister of State for Children/Gender Equality]
The bill calls for the payment of a "Child Allowance" to start from April 2009. The size of the subsidy for fiscal 2009 would be decided separately.

(2) 

Bill to remove tolls for freeways (for submission to the ordinary Diet session) [Next Minister of Land Infrastructure and Transport]
The bill calls for the abolition of tolls on all freeways, except urban freeways, from fiscal 2010 onwards. The possibility of eliminating tolls through budgetary measures will be considered after September 2009.

(3) 

Abolition of the provisional tax rate for taxes used exclusively for road projects, which result to reduction of the underlying tax rates (for submission to the current Diet session) [Next Minister of State for Finance, Next Minister for Financial Services (Tax System), Next Minister of Internal Communications and General Affairs]
The bill calls for the abolition of the provisional tax rate for taxes used exclusively to fund road projects and a decrease of 25 yen per liter in the underlying gasoline tax rate and 17 yen per liter in the underlying diesel tax rate. These measures would be implemented from April 2009. The bill also calls for tax revenues dedicated to road projects to be incorporated into the general budget and for abolishment of the system under which local authorities contribute to public works projects under the jurisdiction of central government.
In addition, based on the "Gas Stations Countermeasures Bill", the DPJ would ease the burden on gasoline stations at the time of the provisional tax rate abolition.

2. Dealing with Pressing Issues

(1) 

Support for young people who do not have stable work (freeters) (for submission to the current Diet session) [Next Minister of Health, Labor and Welfare]
The DPJ will work to promote the employment and improve the employment conditions of non-regular workers through measures such as providing housing support, reviewing the conditions for paying unemployment benefits, and tightening measures to prevent sham worker dispatch arrangements in order to encourage greater job stability among freeters who formerly worked as dispatch workers.

(2) 

Bill to prevent the bullying of small and medium-sized businesses (for submission to the current Diet session) [Next Minister of Economy, Trade and Industry]
This bill would protect small and medium-sized businesses from the demands of large corporations to buy additional unneeded products or reduce prices to unacceptable levels. These measures would be backed up by giving the Fair Trade Commission the right to issue warnings

(3) 

"Finance assessment bill" (for submission to the current Diet session) [Next Minister of State for Financial Services]
The bill will require financial institutions to disclose information on the extent of their contribution to local communities and financing of small and medium-sized businesses. It will also aim to promote fair competition among financial institutions and prevent credit squeeze.

3. Emergency Measures Required through the Supplementary Budget

(1) 

Expand credit guarantee facilities for small and medium-sized businesses (700 billion yen)
The DPJ intends to reinstate the "special credit guarantee system" and guarantee 30 trillion yen in credit. In addition to allowing the delayed repayment of existing loans made under the safety net financing program (which was implemented to offset high crude oil prices), the DPJ also believes that the safety net credit guarantee system should be expanded to cover firms in 900 business categories (only firms that have been in business for 3 years or more).

(2)  Tax law related measures (at least 316 billion yen)
[1] 50% reduction in corporate tax for small and medium-sized businesses (300 billion yen)
[2] Abolish owner?不 tax for small and medium-sized businesses (16 billion yen)
[3] Measures to exclude dividends from overseas subsidiaries from profit calculations
[4] Reinstatement of the carry back system for corporate tax rebates which has been frozen since 1992 (the amount yet to be calculated)

(3) 

Significant expansion to employment adjustment subsidies (Labor insurance special account)
This measure would prevent workers from losing their jobs by relaxing conditions governing the provision of subsidies for companies hiring new workers. Measures would include a relaxation of the conditions of payment, an increase in the subsidy rate and an extension to the payment period.

(4) 

Other
Opposition parties will continue to debate other measures that should be included in the supplementary budget particularly those related to employment, medical services and nursing care.

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