The government is expected to approve a record initial budget Friday for the next fiscal year that will ramp up spending on defense and support for regional economies.
The budget for the year starting in April 2025 will total around ¥115.5 trillion ($735 billion), according to a draft of the plan obtained by Bloomberg on Wednesday. While the draft shows the government will still have to lean heavily on debt issuance to help fund the spending, record tax receipts will enable the cutting back of fresh bond issuance by almost a fifth to ¥28.6 trillion.
The increase from the current fiscal year’s initial annual budget of ¥112.6 trillion is around 2.6%, largely in line with the government’s forecast for overall inflation in this fiscal year. Ministries had earlier requested total outlays of ¥117.6 trillion.
