Japan is a land of two worlds. On one hand, you have the Japan that many people know: the bustling Tokyo, the historic Kyoto, and the relaxing hot spring resorts. On the other hand, you have the Japan that’s been forgotten and filled with abandoned houses, empty schools, and closed shops. But there’s still a glimmer of hope, thanks to an innovative program called the “Furusato Nozei”.

small town store in Japan © Yanai Takahiro

Small town Japan is disappearing faster than ever before. Over half of Japan’s regional municipalities have vanished in the past 20 years as more and more people move to the major cities. Add in the plummeting birthrates and you get vanishing hometowns (furusato)in rural Japan. At the current rate, over 900 of the 1800 municipalities will become ghost towns within this generation.

Rural Japanese Town © Ippei & Janine Naoi

Launched in 2008, ‘Furusato Nozei’ ふるさと納税, or “hometown tax,” hopes to solve this issue. Typically, if you are a resident of Tokyo, you have to pay income and residential taxes to the city of Tokyo. But under the Furusato Nozei program, you are able to donate money to your hometown (or any other small town) and have your taxes reduced by the amount that you donated.

Small town Japanese train station

Why would the Japanese donate money to the small municipalities?

For one thing, even though the Japanese are leaving the countryside for major cities, they are still nostalgic and loyal to their ‘furusato’. Nobody wants to see their hometown disappear.

But the biggest reason is because the municipalities have started to offer gifts in exchange for donations.

Regional Japanese Market © Nick Dewolf

So, what kinds of gifts are given in exchange for donations? The town of Kamishihoro in Hokkaido offers donors hot-air balloon rides across the countryside. Tendo in Yamagata sends donors local seasonal produce, such as cherries, apples, and even beef. Other towns offer locally brewed beer and sake. The city of Nahari offers one of the most extravagant rewards for donors. Their gifts include an entire tuna fish, a selection of locally caught fish, 1kg of regional pork, 5kg of local rice, 500g of handmade miso, and an assortment of regional desserts and sauces.

Japanese rice farmer in rural Japan © tonx

The city of Nahari offers one of the most extravagant rewards for donors. Their gifts include an entire tuna fish, a selection of locally caught fish, 1kg of regional pork, 5kg of local rice, 500g of handmade miso, and an assortment of regional desserts and sauces.

The Furusato Nozei program has been a boon to rural Japan. Towns that used to fall by the wayside are now getting an influx of donations and awareness. Previously forgotten towns have reported a huge increase in visitors and tourists. Some towns are even starting to see a modest population increase.

Japanese Market © Bill Welham

By all measures, the Furusato Nozei program has been a wild success. So much so, that the Japanese government has recently doubled the amount that you can donate to these municipalities.

But not everyone is positive about the long-term success of the Furusato Nozei program. Some think that allowing city residents to offset their taxes will start draining the vital tax revenues needed to maintain the city’s public services. Others think that the program is a temporary band-aid that doesn’t fix the systemic issue of regional decline in Japan.

The most pessimistic of opponents think that the gift-giving system isn’t sustainable. They believe that at some point, the system will implode due to the cost of gifting outpacing the inflow of donations.

Tea farms in rural Japan

What do you guys think? Do you wish you can donate a portion of your taxes to local towns in exchange for gifts?

We here at Snakku are definitely trying help by bringing you the best that Japan has to offer. Some of the best Japanese snacks come from the small mom-and-pop stores in these small rural villages.

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