Key Facts
• Hometown tax deduction system began in 2008, now used by over 10 million people.
• Points awarded via intermediary sites will be abolished by the end of September 2025.
• Donations surged 3.1 times in late August compared to the same period last year.
• Ministry of Internal Affairs deemed point competition inappropriate for a public tax system.
• Rakuten CEO submitted 2.95 million signatures opposing the decision in March 2025.
• Rakuten filed a lawsuit against the Ministry, with the first hearing held on September 16, 2025.
• Intermediary sites like Satofuru are exploring new strategies, such as improving services.
• Municipalities, like Fuchu City, request lower intermediary fees, currently around 10% of donations.
• Some users plan to continue donating despite the removal of points.
• Popular return gifts include Niigata rice, Shine Muscat grapes, and craft beer.
Summary
The hometown tax deduction system, which has grown to over ¥1 trillion annually, is seeing a surge in last-minute donations as point rewards from intermediary sites are set to end this month. The Ministry of Internal Affairs criticized the point system as misaligned with the program’s purpose, leading to its abolition. Rakuten and other businesses have opposed the decision, with Rakuten filing a lawsuit and submitting 2.95 million signatures in protest. Intermediary sites like Satofuru are adapting by enhancing services and offerings. Municipalities, such as Fuchu City, are advocating for reduced intermediary fees. Despite the changes, many users remain committed to supporting local governments through donations.
