Quarantine/Confinement

• On 7th April 2020, the Prime Minister declared a state of emergency based on the Act on Special Measures for Pandemic Influenza and New Infectious Diseases Preparedness and Response, covering the most affected 7 prefectures (Tokyo, Kanagawa, Saitama, Chiba, Osaka, Hyogo and Fukuoka). The Prefectural Governors in the emergency zone issued stay-at-home requests to the local residents.
• On 16th April 2020, all other 40 prefectures were covered by the state-of-emergency declaration. 13 prefectures including the originally covered 7 prefectures were designated as the special caution zones, where containment measures should be focused.
• On 4th May 2020, state of emergency, which was intended to expire on 6 May, was extended to 31 May.
• State of emergency was lifted for 39 prefectures on 14^th May 2020, then for 3 prefectures including Osaka on 21^st May 2020, and for the rest of the 5 prefectures including Tokyo on 25^th May 2020. Requests for refraining from inter-prefectural travel were mostly lifted by 31^st May 2020 but will still be maintained until 18 June for several heavily affected areas including Tokyo.
• Requests for voluntary ban on inter-prefectural travel is completely lifted on 19^th June 2020.

Travel bans/restrictions

Starting with Hubei Province of China on 1 February, refusal of entry has been extended by mid-March to cover the most affected areas in risk countries. 14-day quarantines have been enforced for entrants from China and Korea outside the most affected areas on 9 March, followed by extensions to other areas including Europe, Egypt and the United States. Refusal of entry was expanded in early April to cover 87 countries and areas.

Japan Ministry of Foreign Affairs (MoFA) has issued a series of Travel Advice and Warnings on Infectious Diseases depending on the situation of the Novel Coronavirus. This warning system has the following categories:

• Level 4, Evacuate and Avoid All Travel; Japanese nationals are urged to evacuate immediately from the country/area and avoid all travel regardless of the purpose.
• Level 3, Avoid All Travel; Japanese nationals are urged to avoid all travel to the country/area regardless of the purpose. Japanese residents in the country/area may be advised to consider or prepare for the evacuation: 87 countries and areas including China, the Republic of Korea, the United States, Canada, Australia, New Zealand, 44 European countries and areas and Iran.
• Level 2, Avoid Non-essential Travel; Japanese nationals are advised to avoid non-essential travel to the country/area, and to stay alert to the situation and take appropriate safety measures should they decide to travel: All over the world.

Closure of schools/universities

On 28th February 2020, the Ministry of Education, Culture, Sports, Science and Technology (MEXT) asked elementary schools, junior high schools, senior high schools, schools for special needs education and upper secondary specialized training schools to be temporary closed from March 2nd to the spring break season beginning in late March.

Based on instructions or requests by the Governors, public schools in the 7 prefectures originally covered by the state-of-emergency declaration decided to close until 6 May.

Following the lift of state of emergency on 25 May, public schools were reopened nationwide from June. Staggered school hours and/or hybrid of physical and online schooling are adopted in some heavily affected areas.

Cancellation of public events / Closure of public places

On 26th February 2020, the government asked large scale events and gatherings to be cancelled, postponed, or scale down for two weeks.

The government asked for continuing to postpone or scale down large-scale events until late March.

The state-of-emergency declaration under the law enabled prefectural Governors to ask cencelling large scale events and getherings in their jurisdictions.

Following the lift of state of emergency, prefectural governments plan to gradually ease restrictions on large-scale events in coming months, mostly beginning from June.

On 10th July 2020, the government lifted the request for cancelling events with up to 5,000 participants. Professional baseball and soccer game stadiums started to invite audience subject to the upper limit.

Obligatory shut down of economic activities

Governors in the 7 prefectures originally covered by the state-of-emergency declaration asked nonessential businesses to close until 6 May. Following the extention of state of emergency, requests for closures for nonessential businesses were also extended in many prefectures.

Following the lift of state of emergency, local governments announced their plans to gradually ease restrictions on economic and social activity.

3. Coronavirus (COVID-19) Related Fiscal Policy Measures by Japan

Overall fiscal measures

On 7^th April 2020, the government launched the Emergency Economic Measures of JPY 117 trillion (21.7% of GDP), which adds another JPY 38 trillion of public spending.

On 20^th April 2020, the Cabinet decided the FY 2020 supplementary budget of JPY 25.7 trillion to finance the Emergency Economic Measures. The National Diet approved the budget on 30 April.

On 27^th May 2020, the Cabinet decided the FY 2020 second supplementary budget of JPY 31.9 trillion.

Health system measures

On 28^th January 2020, the Cabinet issued a decree to list COVID-19 as a disease that the Infectious Disease Act and the Quarantine Act apply. With the decree enforced on 1 February, the authority can order the patients about forced hospitalisation and restrictions on work, mandate immigrations to take laboratory tests, and provide medical care with the costs shouldered by the government.

On 14^th February 2020, the government decided the use of the contingent funds included in the FY 2019 budget to finance a package of immediate measures including increasing the testing capacity, subsidizing production of masks and antiseptic solutions, and promoting development of therapeutic drug.

On 17^th February 2020, the Ministry of Health, Labour and Welfare (MHLW) asked people with cold symptoms, a fever 37.5 Celsius degree or over, a strong feeling of weariness or shortness of breath to isolate themselves at home and wait four days before contacting a doctor.

The Basic Policy announced on 25 February prioritised the provision of medical service to vulnerable people such as the elderly and those with underlying diseases.

The second measures launched on 10 March included measures for containment in childcare and long-term care facilities, support for the supply of masks, expansion of PCR testing and medical care capacity and development of therapeutic drug.

07^th April 2020 measures and the first and second supplementary budgets for FY 2020 further increased health spending.

Income support measures for individuals and households excluding tax and contribution changes

On 14^th February 2020, the government eased the qualifications for the Employment Adjustment Subsidy, which provides SMEs and large corporations a financial support that covers 2/3 and 1/2 of the cost of special paid leaves, respectively.

The second measures launched on 10^th March 2020 included responses to the temporary school closures, such as support for parents' work leaves due to closure of their children's school, and employment support.

On 28^th March 2020, the government announced to raise the subsidy rates of the Employment Adjustment Subsidy from 2/3 to 9/10 for SMEs and from 1/2 to 3/4, respectively, for those do not dismiss employees between April and June.

07^th April 2020 measures and the FY supplementary budget include:

1) Cash transfer of JPY 12.8 trillion (2.4% of GDP) provided for every resident (JPY 100 thousand (USD 931) per person) and JPY 2 trillion (0.4% of GDP) for small and medium sized business owners who experience a significant fall of their earnings between February and June.

2) Enhancement of the Employment Adjustment Subsidy including raising the sibsidy rates announced on 28 March.

The FY 2020 second supplementary budget include:

1) Cash tansfer of JPY 136.5 billion (0.02% of GDP) targeted at low-income single-parent households.

2) Further enhancement of the Employment Adjustment Subsidy of JPY 1.3 trillion (0.2% of GDP).

Public sector subsidies to businesses

07^th April 2020 measures include a wide range of subsidies to strengthen the economic structure.

Deferral of taxes and social security contributions and bringing forward expenditures within current fiscal year

On 27^th February 2020, the National Tax Agency announced:

1) Deadline extension (from mid-March to mid-April) for tax return filing and payment of personal income tax, gift tax, and consumption tax (for the self-employed):

2) Deferments on tax payments for individuals and businesses negatively impacted by the COVID-19 outbreak on taxpayers' request.

07^th April 2020 measures include:

Tax payments and social security charges for businesses negatively impacted by the COVID-19 outbreak can be deferred up to one year.

Public sector loans or capital injections to businesses

The first prompt measures announced on 13 February included JPY 500 billion (0.1% of GDP) of emergency loans and credit guarantees for SMEs such as the tourism industry.

The second measures launched on 10 March included financial measures of JPY 1.6 trillion from the Japan Finance Corporation and other institutions, primarily focusing on micro, small and medium-sized business operators. The financial measures included a COVID-19 special loan program which enables unsecured interest-free loans to affected firms. 7 April measures expanded the program up to JPY 45 trillion ()

Loan guarantees by the state benefiting private borrowers

The first prompt measures announced on 13 February included JPY 500 billion (0.1% of GDP) of emergency loans and credit guarantees for SMEs such as the tourism industry.

The second measures launched on 10 March included financial measures of JPY 1.6 trillion from the Japan Finance Corporation and other institutions, primarily focusing on micro, small and medium-sized business operators. The financial measures included a COVID-19 special loan program which enables unsecured interest-free loans to affected firms. 7 April measures expanded the program up to JPY 45 trillion ().

4. Coronavirus (COVID-19) Related Monetary Policy Measures by Japan

Monetary policy

On 2^nd March 2020, the Governor of the Bank of Japan (BoJ) announced that the Bank would strive to provide ample liquidity and ensure stability in financial markets through appropriate market operations and asset purchases.

On 16^th March 2020, the BoJ decided to enhance monetary easing through three measures: 1) actively purchasing ETFs and J-REITs at annualised paces of up to about JPY 12 trillion (2.2% of GDP) and JPY 180 billion (0.03% of GDP), respectively; 2) facilitating corporate financing through (a) increasing the upper limit to purchase commercial paper and corporate bonds by JPY 2 trillion (0.4% of GDP) in total and (b) introducing a new operation to provide loans against corporate debt as collateral at 0% interest rate with maturity up to one year; and 3) providing further ample funds through various means including purchases of Japanese government bonds (JGBs) and U.S. dollar funds-supplying operations.

On 27^th April 2020, the BoJ decided to enhance monetary easing by lifting annual JGB purchase benchmark of JPY 80 trillion (14.8% of GDP), while tripling the corporate bond and commercial paper purchase facility to JPY 20 trillion (3.7% of GDP). It also eased the collateral requirement for the special operation to provide 0% interest loans, so as to provide the loans up to JPY 23 trillion (4.5% of GDP).

On 22^nd May 2020, the BoJ enhanced the special operation to cover business loans provided based on the government's emergency loan programme, or those equivalents in terms of the lending conditions. The size of the new operation is set to be scaled up from JPY 25 trillion (4.5% of GDP) to JPY 55 trillion (10.1% of GDP).

5. Coronavirus (COVID-19) Related Employment Policy Measures by Japan

Income support to persons losing their jobs or self-employment income

Loans up to JPY 200,000 are provided to households, such as self-employment, who have lost income and are in need of emergency and temporary lending to maintain their livelihood due to Covid-19. The government will provide JPY 100,000 per person to all citizens of the country. Due to the impact of the Covid-19, if business income has decreased by approximately 20% or more compared to the same period of the previous year for a period of one month or more from February 2020, and it is difficult to pay taxes at once, the payment of income tax, corporate tax, consumption tax, social insurance premiums, etc. will be postponed for one year.

Helping firms to adjust working time and preserve jobs

The government expanded the coverage of the Employment Adjustment Subsidy (EAS) by including the temporary shutdown due to Covid-19 response and eased the requirement of EAS in the cases of Covid-19 response. One of the required conditions for EAS was 10% reduction of production for more than 3 month . However, a 5% reduction of production for one month will qualify for the subsidy. In addition, the subsidy rate will be increased to four-fifths for SMEs and two-thirds for large enterprises, and, if the enterprise does not lay off workers, to 90% (100% if certain requirements are met, such as taking time off work in cooperation with the governor's request) for SMEs and 75% for large enterprises, as well as to cover non-regular workers who are not insured by employment insurance. Some prefectures provide support fund to SMEs that stop using their facilities in response to requests for closure or shortened business hours from the prefectures. (e.g., Tokyo Metropolitan Government will pay a maximum of JPT 1,000,000.) On 27 May, the government announced that it would increase the maximum subsidy amount to JPY 15 000 per worker per day and that it would make a new scheme where workers in SMEs who could not to receive wages for the period of their absence can receive 80% of their wages.

Financial support to firms affected by a drop in demand

Firms whose sales have been declining by at least 5% due to Covid-19 can get loans at a low interest rate of up to 60 million yen. Also the government will create a new benefit system for SMEs and sole proprietors such as freelancers, who are in a particularly difficult situation. For enterprises whose business income has decreased by 50% or more compared to the same month of the previous year, they will receive the same amount as the income reduction up to 2 million yen for SMEs and up to 1 million yen for sole proprietors. Due to the impact of the Covid-19, if business income has decreased by approximately 20% or more compared to the same period of the previous year for a period of one month or more from February 2020, and it is difficult to pay taxes at once, the payment of income tax, corporate tax, consumption tax, etc. will be postponed for one year. On 27 May, the government announced the creation of a new rent support benefit system to reduce the land rent burden for SMEs whose sales have declined due to the effects of the Covid-19. The rent support is available to businesses whose sales in one month decreased by 50% or more from the same month last year or by 30% or more for three consecutive months. In principle, two-thirds of the rent (maximum monthly amount is JPY 500 000 for corporations and JPY 250 000 for sole proprietors) will be paid for six months. As a special measure, the upper limit will be raised to JPY 1 000 000 for corporations and JPY 500 000 for sole proprietors if they are paying high rents, such as owning multiple stores.

6. Coronavirus (COVID-19) Related Social Policy Measures by Japan

Reducing workers’ exposure to Covid-19 in the workplace

Employers who introduce telecommunications equipment for teleworking as a response to Covid-19 can receive a subsidy of 50% (up to JPY 1,000,000) of the installation cost. The subsidy also covers the cost of creating or changing work rules and training workers, etc. in order to introduce teleworking.

Income support to sick workers and their families

If workers get infected by Covid-19 during work or commuting, workers can be eligibile for industrial accident compensation insurance. Employed workers who are infected with or suspected to be infected with COVID-19 virus and who have to take a time off from work are eligible to a sick-leave allowance financed by insurers of public health insurance (for all firms that join the "Health Insurance" system) provided those workers fulfil certain requirements. The requirement for obtaining a medical certificate has been waived for persons who are in quarantine or diagnosed with the coronavirus.

Income support to quarantined workers who cannot work from home

Private-sector employees who have to quarantine/self-isolate due to COVID-19 are entitled to sickness benefits with same rules as in the case of sickness, as long as (1) the worker cannot work from home and (2) has subjective symptoms. While a written opinion from a doctor was previously required, this is now sufficient to be certified as being unable to work due to medical treatment by the employer.

Helping dealing with unforeseen care needs

Employer subsidy for firms that allow their workers (including full-time and non-regular workers) to take paid leave due to school or child care closure. This leave must not be deducted from the worker's annual paid leave entitlement. Employers are compensated for the continued payment of salaries while workers are on this paid leave, up to a limit of JPY 8 330 per worker per day. On 27 May, the government announced that it would increase the maximum subsidy amount to JPY 15 000 per worker per day. Self-employed workers who are unable to work due to school or child care closures are entitled to a benefit worth JPY 4100 per day off to independent contractors.On 27 May, the government announced that it would increase the maximum subsidy amount to JPY 7 500 per day. Temporary special benefits of JPY 10 000 per eligible child will be paid to households receiving the child allowance.On 27 May, the government announced that it would provide additional benefits to low-income single-parent households (JPY 50 000 yen for the first child, JPY 30 000 per child for the second and subsequent children. Additional JPY 50 000 per household will be provided if a significant decrease in income is confirmed.).

Helping economically insecure workers stay in their homes

Households affected by Covid-19 can postpone utility payments if they cannot afford to pay Expansion of eligibility for the housing allowance scheme to include workers who have taken a leave of absence for reasons not attributable to the individual and whose opportunities to earn a salary have been reduced have been added to the scope of support.; suppression of the previous requirement of showing proof of looking for a job in order to qualify for allowance.

Source – With inputs from Organisation for Economic Co-operation and Development (OECD), International Monetary Fund, World Bank, International Labour Organization (ILO) and Government of Japan