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The story
At a press conference on the 21st, Shizuoka Mayor Takashi Namba revealed that the consumption tax cut on food would shrink local tax grants by ¥2.7 billion a year, and called on the national government to provide compensation. The government plans to cut the consumption tax rate on food from 8% to 1% for two years starting next April, with local governments nationwide expected to lose roughly ¥1.6 trillion a year in revenue. On 5ch, comments clashed between those questioning civil servants’ pay and how local assembly members spend their budgets, and those questioning the funding debate itself.
Regarding the consumption tax cut on food, Shizuoka Mayor Takashi Namba called on the national government at his regular press conference on the 21st to take compensatory measures so that grants to local governments aren’t reduced.
Shizuoka Mayor Takashi Namba: “The impact of the cut, in Shizuoka’s case, comes to ¥2.7 billion in local consumption tax grants. Without an alternative funding source, this would end up affecting things like social security, so we’d like the national government to put compensatory measures in place.”
As part of its response to rising prices, the government plans to cut the consumption tax rate on food from the current 8% to 1% for two years starting April 1 next year, but local governments are expected to lose roughly ¥1.6 trillion a year in revenue, and calls are growing for securing alternative funding.
Source: news.yahoo.co.jp / Original article here
What people said
The real question is how much they're actually raking in.
It's basically all civil servant salaries.
Nothing costs more than personnel expenses.
Ever consider that the tax cut might boost spending and actually raise revenue?
You gonna eat three times as much every day? lolol
That's really the only option left.
Or they cut various support programs —
child medical subsidies, free childcare support centers, that kind of thing.
They've got resident tax and the like, so it should be doable, right?
They could just declare "Public services will collapse!" and hike resident tax for two years to cover it — whether they'd win public support is another story.
handing civil servants cushy post-retirement jobs (amakudari)…
Local governments clearly have money to spare.
Then why are Kumamoto's disaster victims still sleeping on gym floors?
Because Kumamoto's local assembly members and civil servants
won't spend tax money
on the people who actually need it.
Cut city officials' pay by ¥300,000 a year and there'd be plenty of slack.
Cut the assembly members' and mayor's pay too and you could shrink it even further.
This lousy administration acts like tax revenue is just owed to them.
I mean, tax revenue flowing to the government is kind of the whole point?
And civil servant paperwork could be handled by AI.
That would mean only people with outside income could afford to be assembly members.
Also, it'd make it easier for them to funnel favors for personal gain.
If you love the funding debate so much, just roll back the corporate tax cuts that came with every consumption tax hike, and scrap the export refunds too (i.e., abolish the consumption tax).
And they're already raking it in thanks to the weak yen.
Guess you can't say that when you're a lapdog of Keidanren (the big-business federation)…
By the way:
🐨 Tax cuts don't need a funding source
🐼 The only "funding source" is government bonds
🐻 Taxes were never a funding source to begin with
https://up.gc-img.ne…Tvfyj_ONLQh_207.jpeg
● Over ¥600 trillion in tax breaks for big corporations and the wealthy
● ¥12 trillion a year in refunds to exporting companies
● ¥27 trillion a year on civil servant salaries
Well yeah, the population drain just won't stop.
Local governments really do have money to burn.
It was obvious from the start that localities would take a devastating hit.
There's no way the powers that be who ordered this tax cut didn't know that.
They're already working on it — all that's left is hashing out how to fund the compensation.
The opposition has never actually had to run the country, so they can irresponsibly demand a flat 5% or 8% rate.
"Our cut is shrinking, so compensate us" —
what nerve!
They're living off citizens' tax money and still have the gall to complain!
Local civil servant salaries should be cut.
Because if you cut it, you won't attract young people.
Just make up the shortfall from the Employment Ice Age generation (Japan's generation who struggled to find jobs after the 1990s–2000s recession).
Of course once the two years are up and the rate reverts, the compensation will obviously vanish too.
I don't know which country you mean, but how do places where assembly members work for low pay or as volunteers even function?
If you think the UK is doing a good job of it, fine, go with that.
Background and Key Points
Japan’s consumption tax runs at 10%, but food and non-alcoholic drinks already sit at a reduced 8% under the dual-rate system introduced in 2019. The government’s new plan cuts that food rate further, to 1%, for two years from April 2026 — a much steeper reduction than the “10% to 8%” framing most coverage uses. Crucially, a fixed slice of consumption tax revenue — the *chihō shōhizei* (local consumption tax) — is earmarked for prefectures and municipalities by statutory formula and funds ordinary budget items, social security programs among them. Shizuoka’s ¥2.7 billion loss and the nationwide ¥1.6 trillion figure both come from that mechanism, not from any discretionary local tax.
The thread’s real fault line wasn’t over whether the tax cut is good policy, but over who should absorb the shortfall. One camp pointed at local government spending itself — personnel costs, assembly members’ overseas trips, amakudari retirement placements — as fat that should be cut before asking Tokyo for money. The other treated the “funding source” framing as a category error, arguing (in MMT-adjacent terms) that tax cuts don’t require an offsetting revenue source at all, since bond issuance already fills gaps.
What’s missing from the thread is any acknowledgment that Japanese local civil servant pay isn’t set arbitrarily — it’s benchmarked against national pay scales via the Laspeyres index, adjusted regionally, so claims that local salaries are simply bloated skip over the mechanism that actually determines them. Readers should also note the national government hasn’t yet specified how — or whether — it will compensate municipalities once the two-year cut ends; posters assumed compensation lapses with the rate reversion, but that isn’t confirmed policy.
*This article is excerpted and summarized from the 5ch (Breaking News+) thread “Shizuoka City to Lose ¥2.7 Billion from Consumption Tax Cut — Mayor Demands Compensation Measures from Government; Local Governments Facing ¥1.6 Trillion Annual Shortfall, Calls Grow for Alternative Funding”.
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