Japan PM unveils $113 billion stimulus as poll numbers slump

The plan involves income and residential tax reductions of 40,000 yen per person, and 70,000 yen cash handouts to low-income households.

Japanese Prime Minister Fumio Kishida announced a stimulus package worth more than $100 billion on Thursday as he tries to ease the pressure from inflation and rescue his premiership with his poll ratings at a record low.

Voters in the world's third-largest economy have been reeling from rising prices since Russia launched its invasion of Ukraine last year, pushing up energy costs and putting pressure on the government.

"We are seeing that the tide is turning from the vicious cycle of deflation -- symbolised by low prices, low wages and low growth," Mr. Kishida told a meeting where he revealed the size of the package would be around 17 trillion yen ($113.2 billion).

"For the first time in 30 years, we are facing a great opportunity to move to a new economic stage," he added.

"On the other hand, in the current situation where the rise in wages is not catching up with the rise in prices, it is necessary to support people's disposable income temporarily so as to avoid moving back to deflation," he said.

The plan involves income and residential tax reductions of 40,000 yen per person, and 70,000 yen cash handouts to low-income households, Mr. Kishida told reporters.

He also pledged to "lead the way (next year) in urging the business community to raise wages to a level higher than this year".