Abstract
In Japan, the local governments are given the authority to levy local taxes. The local tax revenue is the core revenue source among the various sources of local revenue.
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Notes
- 1.
Shunsuke Kimura, The Regional Administration in Japan, Routledge, 2017 (Kimura 2017 hereafter), p. 39.
- 2.
Kimura (2017), p. 41.
- 3.
The actual amount of LAT has reached around seventeen trillion yen in recent years. Local finances are currently in debt to the extent of two hundred trillion yen. In this financial crisis situation, how to guarantee local revenue is a crucial agenda item: the national government has set the total sum of LAT in order to secure sufficient revenue each year as an important decision-making tool. As a result of such policy- making decisions, the actual size of LAT has remained stable. Source; Shunsuke Kimura, “Decentralization and Local Public Finance in Three Asian Countries—Overview of General Revenue-”, Decentralization in Asian Countries-Reviewing the Present and Designing the Future (4 th International Research Meeting Report), National Graduate Institute for Policy Studies, 2015, pp. 104–105.
- 4.
Nobuki Mochida, “Fiscal equalization transfer”, Fiscal Decentralization and Local Public Finance in Japan, Oxford, 2008 (Mochida 2008 hereafter), p. 103.
- 5.
Ibid.
- 6.
Kurt Steiner, Local Government in Japan, Stanford, 1965, p. 263.
- 7.
The National Tax Administration Agency, Prefectures, and Municipalities are the independent tax agencies, but they cooperate with each other in sharing the information necessary for tax collection.
- 8.
Masayuki Takahashi, Fiscal Decentralization and Development, Palgrave Macmillan, 2012, p. 20.
- 9.
The Mission which was headed by Professor Carl Shoup, a taxation authority, visited Japan in April 1949. The Mission made the intensive studies and presented the Report on Japanese Taxation by the Shoup Mission in August 1949.
- 10.
Osamu Koike, “Local Governance and National Development”, Comparative Studies of Public Administration, EROPA Local Government Center, 1998, p. 64.
- 11.
The prefectures and municipalities manage many public functions in Japan. In other words the responsibilities discharged by local governments cover all their internal administrative needs except for matters of diplomacy, defense which are managed by the central government. Therefore, Japan’s local governments have extensive budgets requiring significant amounts of money. Source: Kimura (2017), pp. 30–31.
- 12.
Eiji Tajika and Yuji Yui, Fiscal decentralization in Japan, Tackling Japan’s Fiscal Challenges, (IMF, Tajika, Eiji. and Yui, Yuji “Fiscal Decentralization in Japan”, Tackling Japan’s Fiscal Challenges, IMF 2006).
- 13.
Mochida (2008), p. 21.
- 14.
Nobuki Mochida, Taxes and transfers in Japan’s local finances, Local Government Development in Post-war Japan, Oxford, 2001, p. 86.
- 15.
See Mochida (2008), op.ict., p. 28.
- 16.
Nobuki Mochida, “Local Government Organization and Finance, Japan”, Local Governance in Industrial Countries, The World Bank, 2006, p. 161.
- 17.
The term “ordinary balance ratio” denotes an index for identifying the elasticity of the financial structure of local public bodies. It is calculated as a percentage of the amount of general revenue sources that are used for expenditures that are ordinarily disbursed every fiscal year (such as personnel expenses, social assistance expenditure, and debt service) in relation to the total amount of general revenue sources, represented by local taxes and ordinary local allocation tax (ordinary general revenue sources), a special share of revenue decrease compensation loan, and an extraordinary financial measures loan. This index is used to see to what extent ordinary general revenue sources are appropriated for ordinary expenditures; it also shows that a higher ratio means less flexibility in the financial structure.
References
Kimura, S. (2015). Decentralization and local public finance in Three Asian Countries—Overview of general revenue. Decentralization in Asian Countries-Reviewing the Present and Designing the Future (4th International Research Meeting Report), National Graduate Institute for Policy Studies.
Kimura, S. (2017). Regional administration in Japan. Routledge.
Mochida, N. (2001). Taxes and transfers in Japan’s Local Finances. Local government development in post-war Japan. Oxford.
Mochida, N. (2006). Local government organization and finance: Japan. Local governance in industrial countries. The World Bank.
Mochida, N. (2008). Fiscal equalization transfer. Fiscal decentralization and local public finance in Japan. Oxford.
Steiner, K. (1965). Local government in Japan. Stanford.
Tajika, E., & Yui, Y. (2006). Fiscal decentralization in Japan. Tackling Japan’ s fiscal challenges. IMF.
Takahashi, M. (2012). A broader view of fiscal decentralization in developing countries. Fiscal decentralization and development. Palgrave Macmillan. White Paper on Local Public Finance, 2014–2015 http://www.soumu.go.jp/iken/zaisei/26data/chihouzaisei_2014_en.pdf. Ministry of Finance Japan http://www.mof.go.jp/english/index.htm.
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Kimura, S. (2017). Japanese Local Tax System and Decentralization. In: Cooray, N., Abeyratne, S. (eds) Decentralization and Development of Sri Lanka Within a Unitary State. Springer, Singapore. https://doi.org/10.1007/978-981-10-4259-1_15
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