Along with a delay of the second consumption tax increase to 10 percent by 18 months from October 2015, analysts say the package is likely to prop up domestic demand, according to the report.

It is estimated that the new package will increase Japan's real gross domestic product by about 0.7 percentage points, Kyodo cited the government as reporting.

The Japanese economy, the third largest in the world, slipped into a recession in the wake of the April's 3-percentage-point consumption tax hike to 8 percent that hurt domestic consumption.

At the same time, under the ultra-loose monetary easing, the yen retreated sharply and a weaker yen drives up the import costs and energy prices at home, hurting households and small- and medium-sized enterprises.