Tax-deductible donations to local governments that allow people to receive gifts of local specialties in return have seen a spectacular jump during the coronavirus pandemic, city officials and operators of donation websites say.
Under the "hometown tax" scheme aimed at aiding rural economies, people can make donations to municipalities where they do not reside. In addition to receiving tax breaks, they can get items in return such as local foods from their chosen municipalities -- gifts that appear to have become more attractive as people spend more time at home.
Operators of websites that mediate between municipalities and donors are betting that the amount raised for fiscal 2020 through next March will top the record of 512.7 billion yen ($ 4.94 billion) in fiscal 2018.
According to a survey conducted in October by Satofull Co., a hometown tax website, 59 out of 221 participating local governments said donations received under the scheme more than doubled between April and September from the same period the year before.
Searches for gifts on Satofull's website rose for items such as dumplings, grilled meat and houseplants. A company official explained: "With restrictions on travel and dining out, it seems many people sought out special local products to enjoy at home."
The city of Kyoto said it has already received a record amount of donations in fiscal 2020, reaching around 1.7 billion yen by the end of December, or 6.5 times more than the 250 million yen for fiscal 2019.
Around 40 percent of the donors chose New Year "osechi" traditional meals from high-end Kyoto restaurants as a gift, with a city official attributing the choice to people wanting to eat well while staying home.
According to Hanamaki city in the northeastern Japan prefecture of Iwate, whose gifts include beef tongue and wine, this fiscal year's donations have reached 1.8 billion yen so far, already triple last fiscal year.
On the other hand, the workload of officials who process the donations has increased as inquiries by first-time donors have also risen, a city official said.
Hokkaido and Osaka Prefecture, meanwhile, have been asking for people to make donations without gifts in return since last April, saying the money raised will go toward supporting their medical institutions and staff as they battle the coronavirus pandemic. The prefectures have each raised more than 1 billion yen with the appeal.
"Usually donations concentrate at the year end, when people rush before the deadline to take advantage of the tax deduction. But coronavirus-related donations have continued throughout the last year, so the amount increased at a higher pace than usual," said an official who manages the hometown tax website Furusato Choice operated by Trustbank Inc.
