The Japanese government has planned to set the size of its supplementary budget for fiscal 2015 at 3.3 trillion yen ($27 billion), the media reported on Saturday.
To help finance the extra budget, the government will use 1.9 trillion yen in excess tax revenues, The Japan Times quoted government sources as saying.
The government is expected to adopt its proposal at a Cabinet meeting by December 18 and submit it at the beginning of a parliament session, to be convened on January 4, 2016, the sources said.
The government will also cut debt-servicing costs, as long-term interest rates have stayed lower than expected, the sources said.
The extra budget will cover key policy measures planned by the administration of Prime Minister Shinzo Abe, such as those aimed at promoting citizens' engagement in society and easing the impact of the launch of the Trans-Pacific Partnership (TPP) free trade area.
The government will earmark 300 billion yen for a cash handout programme that will provide low-income pensioners with 30,000 yen per person.