On March 30, legislation regarding the provision of an allowance for children after 2012 (government submitted legislation comprising a partial revision of the Child Allowance Act“) which had been amended by a joint proposal made by the Democratic Party of Japan (DPJ), Liberal Democratic Party (LDP), and New Komeito party, was passed and enacted at the plenary session of the House of Councillors.
The three parties have been discussing the future of the allowance system for children from fiscal 2012, based on the agreement made last August regarding the review of the “Child Allowance” system. They reached an agreement to amend the government proposal on March 15 and on March 23, the amended bill was sent to the House of Councillors after passing the House of Representatives.
Although the name of the allowance for children will be changed back to the former name of “Child Support Allowance” (Jidoteate) due to the revised legislation, it does not imply a return to the former child allowance system in place at the time of the coalition government of the LDP and New Komeito. The new system will continue with provisions for the “Child allowance” in use in the second half of fiscal 2011. including the applicable age range for the allowance, which includes junior high school students, and the amount to be paid.
1. Amount of child allowance to be provided
(1) For those households not exceeding the income threshold
Under 3 years 15,000 yen per month
From 3 years to end of elementary school (first or second child) 10,000 yen per month
From 3 years to end of elementary school (third child onward) 15,000 per month
Junior high school student 10,000 per month
(2) For those households exceeding the income threshold
Temporary special allowance (prescribed in supplementary provision) 5,000 per month
*The income threshold will be set taking an annual income of 9.6 million yen (for a household comprising a married couple with two children) as a yardstick, this to be established by government ordinance, and to take effect from June 2012.
2. Stipulation of provisions included in the 2011 Child Allowance Act
Establishing requirement for child to be resident in Japan (excepting in the case of overseas study)
Provide allowance for children residing in child protection facilities, by making payment to the facility director or similar
Establish a system wherein childcare fees can be paid directly from the child allowance, and wherein the fees for school meals can be paid directly from the child allowance with the permission of the individual concerned
3. Under consideration (to be stipulated by revision through supplementary provisions)
Consider the state of fiscal and tax measures relating to child-rearing support, based on the influence of the child allowance revisions and the elimination of tax exemptions for income tax and local residents tax, and take any necessary measures.
With regard to the state of special temporary allowances for those whose income exceeds the threshold, take the necessary measures based on the result of the above consideration of fiscal and tax measures
Extend special measures regarding retroactive payment of allowances, included in the special measures law regarding the child allowance for fiscal 2011 from March 31 2012 to September 30 2012, and include a provision to that effect in the related legislation.
The legislation will come into effect from April 1 2012 (income threshold provisions will come into force from June 2012).