Japan’s Ministry of Internal Affairs and Communications will revise the designation criteria for the Furusato Nozei hometown tax donation program on October 1.
Under the local specialty product criteria, the ministry will clarify the “publicity purpose standard.” Previously, even products manufactured outside a municipality could potentially be accepted as gifts in return simply because they displayed the name of the city or town. Going forward, this will require that the local government has, within the past year, procured, distributed, or sold the product itself for publicity purposes; that the number of gifts offered does not exceed the quantity involved in those activities; and that the local government has established a plan to procure, distribute, or sell the product itself for publicity purposes during the designation period.
The method for calculating the “value-added standard” will also be clarified. Until now, issues included situations in which multiple local governments could claim the same product as a local specialty. Going forward, calculations based on price will be the general rule. Manufacturers must prove that more than half of the product’s value was generated within the relevant area, and local governments must publish a list of the certified details by the date they begin offering the product.
For the procurement cost of return gifts, the regular retail price must also be stated on the certificate and disclosed. Local governments will be required not to procure items at prices higher than their regular retail prices without reasonable justification.
As a result, some municipalities may stop listing return gifts such as home appliances, beauty products, watches, whisky, beef tongue, and salmon.
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