Furusato Tax Donations Surge Ahead of End to Point Rewards

Sep 17, 2025 | News On Japan

TOKYO - The furusato tax donation program, which has grown into a system worth more than 1 trillion yen annually, is seeing a surge in last-minute contributions ahead of the end of point rewards at the end of September. Donations made through intermediary websites had come with points redeemable for shopping and other perks, but the government has decided to abolish the system.

The program began 17 years ago and is now used by more than 10 million people. A man who rushed to make a donation this month said he felt pressured: "I haven’t done it yet this year, so I’ll try to finish within the next two weeks." His urgency stems from the end of point rewards.

Until now, intermediary sites had independently provided reward points. However, the Ministry of Internal Affairs and Communications deemed that competition over point rates was excessive and undermined the program’s purpose. "This is a public tax system, not online shopping," the ministry said.

For many households struggling with stagnant wages, points had provided a welcome benefit. One donor commented, "It really helps with living expenses. It’s disappointing they’re being abolished."

Businesses have also pushed back. In March, Rakuten CEO Mikitani submitted more than 2.95 million signatures opposing the move to Prime Minister Kishida. Rakuten has also filed a lawsuit against the ministry, calling the regulations excessive and unlawful. The first hearing was held at the Tokyo District Court on September 17th.

The government has shown a clear stance to contest the lawsuit. Rakuten argues that point rewards are fully funded by the company itself and do not distort the purpose of the furusato tax. The company insists that the points are not designed to drive improper donations or increase profits, but simply to encourage users to select its platform from among many competitors.

Despite the controversy, the looming deadline has fueled donations. In August, contributions were more than triple the level of a year earlier. Intermediary site Satofull reported, "We expect the rush in September to continue."

Sites are now looking for new ways to retain users, such as improving return gifts, making apps easier to use, and enhancing overall services.

For municipalities receiving donations, fees remain a major concern. Fuchu City in Tokyo, known for its popular craft beer return gifts, says intermediary sites typically charge about 10 percent of donations as fees. A city official noted, "We’re hoping for lower fees, but we haven’t been given any assurance yet."

While some donors say they will continue regardless, others admit they were drawn in by the perks. As one donor put it, "Supporting a place you care about is the essence of the system. Points or not, I won’t stop contributing."

Source: TBS

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