As Japan grapples with rising living costs, particularly in the wake of increased prices for essential goods like food and postal services, the government has stepped in with financial support for low-income households. In November 2024, a significant decision was made to provide benefits to those exempt from resident tax, aiming to alleviate the financial strain felt by many families.
Under this new initiative, eligible households will receive a payment of 30,000 yen. Additionally, families with children under 18 will receive an extra 20,000 yen per child. This measure is part of the government's broader strategy to combat the negative impacts of inflation and rising prices, which have left many citizens feeling the pinch.
Households that qualify for these benefits include those where all members are exempt from the per capita levy of resident tax for the 2024 fiscal year. This exemption applies to various household configurations, such as those where all members are either non-taxpayers or a mix of taxpayers and non-taxpayers for the same levy. However, it's important to note that households that received benefits in the 2023 fiscal year, those who did not apply, or those who declined benefits will not be eligible for the new payments.
To illustrate the eligibility criteria, the article uses Sapporo City as a case study. Resident tax is calculated based on the previous year's income, meaning that if a household has no income, their resident tax is zero, granting them an exemption. Moreover, even households with limited income may qualify for this status, as the income thresholds vary by municipality.
In Sapporo City, the income standards for being classified as a resident tax-exempt household are clear. For example, a single-person household earning only from part-time work can qualify if their total annual income is 450,000 yen or less. Consider the case of A-san, who earned 984,000 yen in the previous year (approximately 82,000 yen monthly) with no other income. After applying the earned income deduction of 550,000 yen, A-san’s taxable income drops to 434,000 yen, placing them below the threshold for receiving the 30,000 yen benefit.
For households with more dependents, the criteria adjust accordingly. Take B-san, who has a spouse and one child. Their household is eligible for the exemption if their combined annual income is less than a specific calculation: 350,000 yen multiplied by the total number of household members, plus an additional 310,000 yen. If B-san’s household income is 2,020,000 yen (approximately 168,000 yen monthly), after considering the earned income deduction of 686,000 yen, their taxable income would be 1,334,000 yen. This calculation shows that they fall under the exemption threshold, allowing them to receive the 30,000 yen payment, plus an additional 20,000 yen for their child, totaling 50,000 yen.
Furthermore, the same rules apply to elderly individuals. C-san, who is over 65 and receives only old-age pension income, can also qualify under similar conditions. If C-san's total pension income for the year is 1,536,000 yen (about 128,000 yen monthly) and they have no other income, their public pension deduction of 1,100,000 yen results in a taxable income of 436,000 yen. Since this amount is below the 450,000 yen threshold, C-san will receive the 30,000 yen benefit as well.
These examples highlight the government’s intent to support the most vulnerable citizens amid economic challenges. As municipalities across Japan begin to implement these payments, many have already started accepting applications, reflecting a proactive approach to addressing the financial difficulties faced by low-income households.
As the cost of living continues to rise, the Japanese government’s initiative to provide financial assistance is a crucial step in supporting those who are struggling. The decision to offer benefits to resident tax-exempt households underscores the recognition of the hardships many families are facing in today's economic climate.
In addition to the central government's measures, local municipalities may offer their own independent benefits to further assist residents. The specifics of these additional programs can vary significantly, so residents are encouraged to check with their local government websites for detailed information on eligibility and application processes.
In conclusion, as inflation and rising prices continue to challenge daily life in Japan, the government's decision to provide financial support to low-income households represents a vital lifeline for many. With payments set to roll out, families can look forward to some relief, even as they navigate the ongoing economic landscape.
