Japan's Cabinet has approved basic economic and fiscal policies that include measures to reconstruct state finances and address labor shortages.
The guidelines endorsed on Friday put off the goal for achieving a primary balance surplus by 5 years to fiscal 2025. A surplus means that the government can finance policy-related expenditure without incurring new debt.
The guidelines clearly call for the consumption tax to be raised to 10 percent in October next year as scheduled to help fiscal reconstruction.
They say the government will consider including special measures in the budgets for fiscal 2019 and 2020 to mitigate the negative impact of the tax increase on consumption.
The government will create a new status for non-Japanese workers to address deepening workforce shortages.
Foreign workers who have completed a government-backed technical internship program and others with certain skills will be able to stay in Japan for up to 5 years.
The government aims to provide free preschool education and day-care services from October 2019 to coincide with the consumption tax increase.
It will use the guidelines to draw up a draft budget for the next fiscal year.