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よしこ先生/Yoshiko

Hello, I am Yoshiko, a Certified Public Tax Accountant of Japan, 税理士 pronounced “ZEIRI-SHI” (hereafter CPTA).
Today, I found a news article about Furusato-Nouzei for Companies on 日本経済新聞 pronounced Nihon Keizai Shimbun, the Nikkei in English, which is one of the Japanese leading newspapers.
Sakiko, an aunt of my tax staff member, Hikaru, is visiting me now and she is interested in the news.
We would like my website viewers in front of the PC screens now to join in.

さきこ/Sakiko

Hello, everyone.  I am Sakiko.  I am the representative director of my family company and interested in Furusato-Nouzei of company version; though, I am not familiar with it.
Today, I would like Yoshiko to give me a basic idea about it.

I. Overview  

According to the Nikkei news article on August 15, 2019,  the Japanese government has begun to discuss the expansion of Furusato-Nouzei measure for companies.  The Furusato-Nouzei for Companies now allows them to reduce their tax payment by 60%, however, the government is considering to raise the percent as high as 90%.

On top of the hike of the reduction percentage, the effective period of the temporary measure to extend the effective period by the year 2024 which is originally by the year 2019.

Ⅱ. What happened

さきこ/Sakiko

I did not know that companies can use Furusato-Nouzei.

よしこ先生/Yoshiko

I understand that you did not know the system because Furusato-Nouzei for Companies is much less known by people.

さきこ/Sakiko

Do companies receive reward gifts in return for their contribution?

よしこ先生/Yoshiko

No.  Under Furusato-Nouzei for Companies, they are not allowed to receive any economical rewards from the local governments in contrast with Furusato-Nouzei for Individuals.

さきこ/Sakiko

What else are the differences from it for individuals?

よしこ先生/Yoshiko

No.  Under Furusato-Nouzei for Companies, they are not allowed to receive any economical rewards from the local governments in contrast with Furusato-Nouzei for Individuals.

Please let me clarify the advantages of the Fususato-NOuzei for Companies.

Ⅲ. What is the advantage of the Furusato-Nouzei for Companies

1. Under the regular tax credit for both the National and Local Corporate Tax, 30% of the contribution* can be deducted from taxable income.
2. Under the Furusato-Nouzei for Corporations, a temporary tax mitigation measure, 30% of the contribution can be deducted from both National and Local Corporate Tax payments.
3. Another 30% tax credit of the contribution* on top of the above 1 and 2 have begun to be discussed by the government. 

*　The contribution must be for the specially designated and certified projects under the Furusato-Nouzei for Companies measure.

さきこ/Sakiko

This special tax deduction and tax credit seems very advantagious.
If we find a qualified project to deserve to contribute some money from my business, I definitely consider to use it.

Useful Links

https://www.kantei.go.jp/jp/singi/tiiki/tiikisaisei/kigyou_furusato.html