Japan hometown tax changes mean donors face reductions in gift sizes

It's a crazy scheme idea should have never been able to exist in the first place. Some municipalities, including Setagaya and Yokohama, complaining having budget shortfalls thanks to this dumb scheme.

That’s good.

This system should have never been put in place.

Your city gives you some basic services from your taxes (might be for some concrete) , some being able to get back subsidies or any other form of help, like garbages pickup, some free health consultation or cheap vaccines, etc…This has a cost. Less money means less services or an increase of taxes to compensate.

"I understand the purpose of regulation, but it is too complicated,"

That's Japan, make something complicated after some time make it even more complicated.

I knew this would happen! The big cities at first thought that it was a cute idea that people would send a little money back to their hometowns. But when it became really successful and a lot of money was being sent they didn't like not receiving all of the tax money. What these cities fail to remember is that it is the small towns and cities that produce all of the people who move to Tokyo and make it what it is. Without this money they will suffer more and these places will die off even faster.

I agree with @JeffLee and @didou.

The entire furusato nozei program, created in 2008, is economic lunacy — an inefficient system that clearly favors the wealthy, widens economic inequality between high- and low-income earners, has a detrimental effect on market mechanisms, and results in greater trucking and associated emissions.

Contributors are often given a choice of how the donation is to be used, and two options that I repeatedly see are (1) local fireworks festival and (2) increased security, both of which make you wonder: Are pyrotechnics and greater policing Japan’s answer to shrinking communities? 

In fiscal 2017, approximately 1.4 billion yen in residence tax flowed out of Suginami Ward through the furusato nozei program. Two years previously, the figure was 130 million yen, which is to say that the figure increased approximately tenfold in two years. If you live in Suginami Ward, and you make use of the services provided by Suginami Ward, your resident taxes should probably go to Suginami Ward.

My opinion here, it's a discriminatory system, plain and simple! People who dont use it, get zero added benefits from their own local municipalities where their taxes are collected and used.

It should be thrown out entirely!

Another money-grubbing government scam to soft-soap the gullible before soaking and rinsing them.

This system should have never been put in place.

The system should have never been necessary in the first place. This is the typical Japanese way to solve a problem, instead of the complicated and actually productive solution people put forward simple and easy measures that end up causing extra complications and problems, for which extra "simple and easy" measures become necessary in a vicious circle without end.

Apart from the program inefficiency, I see a lot of local and corporate hands trying to grab a piece of a cake that is not theirs.

I’ve taken advantage of the program to “donate” to a municipality that supported my professional development a number of years ago. Ideally, I’d be able to direct my tax monies to them without receiving a gift in return or only some credit on my local residence tax in one of Japan’s mega cities.

Japan and their crazy schemes. Gifts for tax money, point cards, stamps cards, sign-up bonuses, discounts for using app coupons, anything but giving us actual purchasing power by increasing wages. Not saying I don't enjoy earning rewards, but it's not like I would be able to use these point cards in a time of need.

This system is crazy. For 2000 yen you can get a lot of free stuff. The higher your salary is, the more of these free gifts you can get.

Of course I have used it as it would be stupid NOT to get the free (2000en) stuff.

Well…if the incentive to donate gets reduced, guess what happens to our donations?

This scheme is truly an abomination, in terms of the distorting effects it is having on economic behavior.

Not mention the fact that it means high income earners can avoid paying for things like rice and beer and meat.

Not only that, instead of people buying produce from their local supermarket, it creates a situation where people are shipping stuff way across the country, when more locally produced products would fit the bill.

That’s not to mention the waste of people on this crazy scheme when they could be put to better use doing something more beneficial for Japan.

Instead of coming up with these bureaucratic, Frankenstein-like schemes, how about the government just stops spending so much money, blows away some useless regulations, and cuts everyone’s taxes a bit? Wouldn’t that be better?

(Personally, I take full advantage of furusato nozei but that doesn’t mean I think it’s a good scheme)

If you live in Suginami Ward, and you make use of the services provided by Suginami Ward, your resident taxes should probably go to Suginami Ward.

Must be several Suginami residents on here, but have you seen some of things Suginami ward spends money on? I’m sure it’s the same in other municipalities.

One thing I have seen first hand in Japan, is when a public organization has a “budget”, it finds a way to spend it all, it doesn’t matter that the taxpayers would never spend that money that way if it were left to them.

So, I agree it’s a terrible program, but punishing bad spending by local government, is one redeeming feature of this scheme. Overall, I’d abolish it if I were Finance Minister though. But it’s not the only thing.

One thing I have seen first hand in Japan, is when a public organization has a “budget”, it finds a way to spend it all, it doesn’t matter that the taxpayers would never spend that money that way if it were left to them.

Unfortunately this come from the culture that punish frugality by reducing the budget the next year for anybody that did not use it all. The money is wasted so it will keep coming the next year (where it may actually be necessary), once again a simple solution that creates more problems and will be "solved" with further simple solutions.

@fxgai

Would love to hear specifically how you have witnessed first-hand Suginami Ward wasting resident tax.

Would love to hear specifically how you have witnessed first-hand Suginami Ward wasting resident tax.

For example, replacing all of the traffic lights even when the "old" ones were already replaced 5 years before.

Not Suginami, but my own city. Plenty of examples like that.

Asiaman7,

My first hand experience was not in Suginami, but as for Suginami, the commies call out one example here - a beach court:

https://www2.jcp-tokyo.net/nogaki/policy

a beach court

A beach volleyball court on the public school grounds. Hmm? I like it — particularly given the nation’s love of volleyball. Definitely better than another security guard.

I like this system. We live out here in the sticks and it brings in a lot of extra "buyers" to local businesses here.

My first hand experience was not in Suginami, but as for Suginami, the commies call out one example here - a beach court:

https://www2.jcp-tokyo.net/nogaki/policy

The communists call out wasteful spending benefiting corporate crony interests instead of the people while the right-wing , pro-business parties spend like drunken sailors on corporate welfare socialism for the rich.

Should make you think.

In principle furusato nozei benefits prefectures like Tottori hit by depopulation but as usual it is a lazy LDP stopgap solution perfect for exploitation by their special interests.

Weren’t these schemes designed to benefit the wealthy people instead of the average earners? If so, then good riddance!

A beach volleyball court on the public school grounds. Hmm? I like it

I’m fine with people wanting to use a beach court, but it is not something I would expect a Tokyo 23 wards municipality to be paying for with tax payer’s money.

So when the municipalities turn around and complain that they could build some new childcare facilities with the money they lose to furusato nozei, I have no sympathy. That’s a matter of then prioritizing spending, and dare I say beach court users are in a minority (and their needs ought be met through private enterprise, not use of tax payer funds, in my opinion).

Weren’t these schemes designed to benefit the wealthy people instead of the average earners? 

Well, an average earner only pays so much tax. A higher earner pays more tax to begin with, so….

There is a tradeoff between getting big amounts of taxes redistributed to regions, versus ensuring people with means have an incentive to participate.