Briefing for the Diplomatic Corps and Foreign Companies in Tokyo concerning the Special Zone for Reconstruction

JETRO held a press conference today allowing representatives from Iwate, Miyagi, Fukushima, Ibaraki and Aomori prefectures to explain what they are offering to companies to relocate and/or invest in their prefecture. Here are the benefits they presented (taken from Japanese presentation):

Aomori Prefecture

  1. Assistance for capital investment to a maximum of 2 billion yen
  2. 5,000 yen per square meter to acquire land
  3. Discount on electricity use in places like Rokkasho and Mitsusawa
  4. Decrease in fixed asset tax for 3 to 5 years.

Additionally, bullets were presented describing special depreciation and tax exemption for new and used equipment, exemption on corporate tax based on the salaries/wages of employees affected by the March 11, 2011 disaster, 5 year tax holiday for developing new sites, special tax treatment on the depreciation of research and development centers both new and existing, and exemptions for business tax, real estate aquisition tax, and fixed asset tax.

Ibaraki Prefecture
Has budgeted 14 billion yen to subsidize new factories and logistics facilities covering the cost associated with land aquisition and development of mass production facilities. The prefecture will subsidize 1/4 of the investment with a maximum of 3 billion yen per company. Qualifying investments must be valued over

  • 100 million yen and employ at least 5 local workers.
  • 1 billion yen and employ at least 10 local workers.
  • 5 billion yen and employ at least 50 local workers.

Ibaraki Prefecture is also offering preferential treatment in order to secure employment opportunities in designated areas. These include:

  1. special depreciation of 25-100% and tax exemption of 8% and 15%
  2. special corporate tax exemption (10% of salary/wages applied to disaster victims)
  3. special tax treatment for new site development and construction (5 year tax holiday limited to employment in the affected areas)
  4. special tax treatment for research and development facilities (immediate depreciation and 12% tax exemption)

and measures applied to uneven tax and regional tax exemptions.

Fukushima Prefecture
Fukushima Prefecture representatives pointed out the following measures to attract investment:

  • Highest subsidy limit and grant rate within Japan.
  • Attracting investment fixed at 3 years.
  • Increased benefits to those who relocate early.
  • Increased benefit rates for areas located in previously designated evacuation zones.
  • Assistance to purchase land including purchasing and development expenses.
  • Promotion of the introduction of renewable energy.
  • Promotion of investment and employment based on the size of investment.

Fukushima Prefecture is targeting industries focused on shipping machinery. semicondutors, medical devices, renewable energy, agriculture and commerce. Additionally, manufacturing and research that accelerates promotion of industrial areas, companies involved in logistics and distribution centers and any company the prefectural governer deems necessary.

The subsidy limit is set at 20 billion yen granted at the following rates:
Areas initially designated as evacuation areas

  • First Year – Up to 3/4
  • Second Year – Up to 2/3
  • Third Year – Up to 1/2

Areas not covered in above

  • First Year – Up to 2/3
  • Second Year – Up to 1/2
  • Third Year – Up to 2/5 except for SMEs which are eligible for up to 1/2

Assistance is for initial investments in locating plants with 1% or more of the initial investment cost being applied renewable energy such as solar and wind power generation, and storage battery manufacturing. The following requirements apply:

  • 100 million yen and employ at least 5 local workers.
  • 1 billion yen and employ at least 10 local workers.
  • 5 billion yen and employ at least 50 local workers.
  • 10 billion yen and employ at least 100 local workers.

Further, the passing of a special measures law, expands the scope of additional measures that can be taken.

Iwate Prefecture
Iwate Prefecture representatives pointed out the following measures to attract investment:

  • Low interest financing of up to 80% of the investment with a maximum 2 billion yen limit per plant.
  • Up to 10% (maximum 30%) of eligible costs with a maximum 300 million yen per plant. Possibility of receiving more with a larger investment.
  • Tax exemption or deduction for fixed asset tax, corporate tax and for establishing a new research facility. Additional tax relief measures are being considered for special zoned areas.
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