FY2026 Local Finance Council Meeting Summary: August 28

The Local Finance Council deliberated and approved the allocation of the Special Corporate Business Tax Allocation for August of FY2026 under Article 33 of the Act on Special Corporate Business Tax and Special Corporate Business Tax Allocation. The meeting was held on August 28, 2026.

The system was established to address the structural issue of tax revenues becoming concentrated in large cities against a backdrop of widening disparities in fiscal capacity among regions, the shift toward service-based industrial structures, and the expansion of internet transactions, thereby enabling cities and rural areas to support one another and develop together in a sustainable manner.

The restricted amount is apportioned and added on the basis of population for prefectures other than entities with excess financial resources.

The population used for the allocation criteria is the finalized figure from the most recent census. Because the FY2025 census population is currently a preliminary figure, it will be reflected starting with the November allocation after the finalized figure is published in September, and it will not be applied retroactively to amounts already allocated.

The Special Corporate Business Tax Allocation is allocated every fiscal year in May, August, November, and February. No restriction is imposed in May because the amount of excess financial resources has not been finalized before the calculation of the Local Allocation Tax; allocation restrictions are imposed in August, November, and February after finalization.

For the amount already allocated in May to entities with excess financial resources, an amount equivalent to one-third of the amount that should be subject to allocation restrictions is deducted in August, November, and February from the amount that should originally be allocated in each period.