Five years have passed since the furusato (hometown) tax, a system that lets taxpayers donate some of their residential taxes to their former hometowns or other towns they want to support, was enacted. This year, the cities of Fukuoka and Kitakyushu topped previous record highs for furusato tax revenues, but as municipalities compete with each other to reward furusato taxpayers with local specialty goods, the gap between towns in terms of taxes donated is starting to grow. Between April and October of this year, Fukuoka City received a whopping ¥75.6 million in furusato tax allocations, which it plans to use to help build a lodging facility for families whose children are patients at the Children’s Hospital. According to a City official, it appears that many ex-Fukuokans felt this was a worthy cause to donate to. This year was the 50th anniversary of Kitakyushu’s incorporation as a city, so it started sending mentaiko and other gifts to furusato tax donors and, in turn, saw tax donations rise to 6.4 million. According to the Ministry of Internal Affairs and Communications, 52% of municipalities in Japan employ some sort of reward system for furusato tax donors, so it appears that those that don’t struggle to attract funds. Miyazaki Prefecture collected over ¥150 billion in furusato tax in FY2010 after an outbreak of foot and mouth disease, but so far this year, it has only collected ¥2.7 million, so it is considering offering local specialty goods in return for donations. Some municipalities have expressed displeasure with the gift-giving, and in September, the national government sent a letter to all of Japan’s local governments warning them to “use common sense because “overuse of rewards is out of alignment with the objectives of the system”. Source: Nishinippon Shimbun 12/16
