TOKYO, Dec 20: Japan unveiled a draft budget on Wednesday that will cut new borrowing to the lowest level in 10 years, thanks largely to a huge increase in tax revenues on the back of a strong economic recovery.

The first budget by Prime Minister Shinzo Abe also seeks to limit overall government spending to pave the way for fixing Japan's public finances, now in the worst condition among major industrialised countries.

Finance Minister Koji Omi said on Wednesday Japan needs to carry on with fiscal reform even though its fiscal conditions have improved.

He said Japan would need to consider more measures to boost revenues, including consumption tax, in next year's tax reform.

Next autumn we must carry out drastic reforms in fiscal revenues including the consumption tax, Omi told a news conference.—Reuters