With the publicity that the proposal received, the Japan Tourism Agency was forced to dismiss these reports in a series of tweets posted on its official twitter account in both Japanese and English. The agency clarified that the plan is aimed at boosting domestic travel demand within Japan.
Japan Tourism Agency Statement
Regarding reports by some news outlets that “The Japanese government is considering a campaign to help foreign tourists visiting Japan by offering support for half of their travel expenses,” please note that the Go to Travel Campaign under consideration by the Japanese government is to stimulate domestic travel demand within Japan after the Covid-19 pandemic and only cover a portion of domestic travel expenses.
So it looks like there will be no discounts for those looking to visit Japan in the near future. The refunds will be available for Japanese residents, so foreigners will likely not receive any such refunds, even when travelling within Japan.