Furusato Nozei Donations: Return System to Original Purpose of Regional Revitalization

Editorial

16:55 JST, May 25, 2026

People make donations to the hometown where they were born and raised, or to local governments that they are connected to, in order for the money to be used for regional revitalization. It seems the furusato nozei system, a tax deductible donation program, needs to return to this original purpose and correct its distortions.

The Internal Affairs and Communications Ministry has asked major operators of furusato nozei intermediary websites to lower commissions they receive from local governments.

This move comes after many local governments have called for the system to be improved, saying that the burden from commission payments to the operators is excessive. Even though some municipalities individually requested that the operators cut commissions, the operators have reportedly refused, citing reasons such as commissions being uniform nationwide.

The amount of donations through the furusato nozei system, which was launched in 2008, has increased steadily. In fiscal 2024, the figure reached a record high of ¥1.2728 trillion.

However, only 54% of this amount was used by local governments as funding for their services. The remainder was allocated to costs for things like procuring gifts in return for donations and paying commissions to intermediary site operators. These commissions reached ¥137.9 billion, which is equivalent to 11.5% of the total amount donated through the sites.

It must be said that the current situation, in which only about half of the amount donated has become revenue for local governments, is far from the system’s original purpose.

When the furusato nozei program was introduced, donors and local governments dealt directly with each other, but intermediary businesses became involved as donation amounts increased.

Currently, users who make donations through furusato nozei portal sites account for more than 90% of total donors. This is because these sites allow users to see at a glance gifts that they can receive from all over the country. In reality, it is difficult for local governments to collect large donations without relying on these sites.

If site operators refuse to lower commissions, taking advantage of the municipalities’ weak position, wouldn’t such an act damage their corporate image?

Some people say the commissions the site operators received were initially about 3% to 5% of the donation amount when they began participating in the furusato nozei program. The operators should listen sincerely to the voices of local governments that rely on the program as a vital source of revenue.

In the past, various issues have arisen regarding the furusato nozei program.

Some local governments offered high-value gift vouchers and other items, causing intense competition for donations through expensive gifts. In 2019, the central government implemented a measure to limit the value of gifts to no more than 30% of the donation amount. However, multiple municipalities were found to have failed to comply with this rule in fiscal 2024.

This situation, in which local governments prepare expensive products out of a desire for tax revenue, while donors select gifts as if they were shopping, has clearly deviated from the system’s original purpose. Local governments should operate this program with restraint.

(From The Yomiuri Shimbun, May 25, 2026)