Japan to Expand Child Aid in April; Price Hikes to Hit Households

Tokyo, March 31 (Jiji Press)–While Japan is set to expand its child-rearing aid program from April, households are expected to be hit by a string of price hikes for food products and beverages. Starting Wednesday, the country will launch at full scale a scheme to allow any child to enroll in nursery facilities regardless of whether their parents work or not. The program will be funded by a child-rearing support fund scheme, with fees collected on top of public medical insurance premiums from all households, including the elderly who have already raised their own children. Under the fund scheme, corporate employees will pay an average of 500 yen every month in fiscal 2026 starting Wednesday. The support fund will also finance child allowances and 100,000 yen provided to each pregnant women. Starting next month, high school tuition will become virtually free for private schools, as it already has for public schools, with families receiving up to 457,200 yen per year in tuition aid for each full-time private school student, regardless of income. Public funds will cover up to 5,200 yen per child per month for school lunches at public elementary schools. Regarding the 1.3-million-yen annual income threshold separating those who lose their dependent status and are required to pay social insurance premiums from those who do not, the country will start to calculate annual income excluding overtime pay. Under a program in which the country starts reducing pensions for working seniors, the threshold is currently set at a combined monthly total of 510,000 yen in salary and pension income. Starting next month, this will be raised to 650,000 yen. Through both threshold changes, the country aims to help prevent people who want to work more from cutting back their hours and to ease labor shortages. Meanwhile, a February survey by Teikoku Databank Ltd. showed that price hikes are expected to hit over 2,500 food and beverage items in April. Nissin Food Products Co. will raise prices for its instant noodles and other products by 5-11 pct. Companies will increase their cooking oil prices by around 8-15 pct, while prices will also go up for mayonnaise, salad dressing and whisky products. Japan Tobacco Inc. and other companies will raise their prices for heated tobacco products by 20-50 yen per pack, with the country’s taxes on such items set to rise in April to help secure funding to boost its defense capabilities. Major power companies will increase their April electricity bills for average households by 393-463 yen, reflecting the end of government subsidies. Four major city gas providers will raise their bills by 148-195 yen. An emissions trading scheme involving companies with significant carbon dioxide emissions will be fully launched next month. Also from April, the provisional gasoline tax surcharge for gas oil will be scrapped, following a similar move for gasoline last year, if related bills are passed through the country’s parliament before fiscal 2025 ends on Tuesday. The environmental performance tax, which has been imposed when people buy cars, will also be abolished. In light of soaring housing prices, the maximum amount of “Flat 35” fixed-rate housing loans, which are provided by the Japan Housing Finance Agency, will be raised to 120 million yen from 80 million yen. Major banks are expected to raise their variable mortgage rates, which account for 80 pct of their new home loan contracts. END [Copyright The Jiji Press, Ltd.]