Japan reboots DOGE-style spending review to fund Takaichi pledges
TLT•Japan will widen its spending review to examine 201 special-purpose government funds, estimated to hold about 7 trillion yen ($44.35 billion) by the end of the next fiscal year, as it seeks funding for Prime Minister Sanae Takaichi’s pledges.
1. Review expands scrutiny
Japan’s government said it would reboot its DOGE initiative, focusing on special-purpose funds and subsidies. The previous review of roughly 120 tax breaks produced three proposals to abolish them. The renewed review calls for idle or long-unused funds to be returned to the national treasury and stricter cost-benefit assessments of subsidy programs.
2. Funding and debt concerns
The findings are expected to feed into year-end tax reform talks and budget negotiations, including plans for a consumption tax cut on food from April 2027. The 10-year Japanese government bond yield has hit multi-decade highs amid concerns that Takaichi’s spending plans may increase debt issuance and strain public finances. Takaichi has pledged to cap new debt issuance at around 40 trillion yen, while requests for next year’s budget reached a record 143 trillion yen.
