Japan plans 3 trillion yen extra budget amid concerns over fiscal strains

TOKYO - Japan's government will compile an extra budget of some 3 trillion yen ($18.88 billion), Prime Minister Sanae Takaichi said on Monday, stoking concerns over fiscal expansion that could further strain the country's already stretched finances.

The extra budget comes as the government decided to use roughly half of its 1 trillion yen contingency reserves to fund subsidies aimed at curbing utility bills, increasing the need to replenish reserves amid the risk of a prolonged Middle East crisis.

But Takaichi said any additional issuance of deficit-financing bonds to fund the extra budget is likely to be offset by higher tax revenue and others, keeping the calendar-based market issuance of bond amount unchanged from that originally planned.

($1 = 158.9300 yen)

(Reporting by Makiko Yamazaki; Editing by Alison Williams)

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This story was originally published May 25, 2026 at 1:56 AM.