Japan’s government has 1.2 trillion yen ($15 billion) in left-over funds from last year’s budgets, money that can be used this year to reduce debt and fund fresh spending, the Finance Ministry estimates.
Tax revenue for the year ended March 2012 was 42.8 trillion yen, 803 billion yen more than the government estimated, according to a ministry document obtained by Bloomberg News.
Extra budget funds may provide some relief to Prime Minister Yoshihiko Noda, who this week managed to obtain lower house approval for a bill to double the sales tax to 10 percent by 2015 to tame the world’s largest public debt. Fitch Ratings lowered Japan’s debt rating in May, citing the “leisurely” progress of Japan’s fiscal consolidation while Moody’s Investors Service lowered the country’s rating last year, keeping it on a negative watch.
The government also issued fewer new government bonds last fiscal year than initial estimated because of the increased tax revenue, helping trim debt service costs. New bond sales were 42.8 trillion yen, 1.8 trillion yen less than the projection, the document shows.
On top of the 1.2 trillion yen in left-over money, the government also had 748.9 billion yen in unused funds which had been allocated to pay for earthquake-reconstruction efforts, according to the document.