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IV National Financial Support to Promote Municipality Mergers
The national government has decided to take the following financial measures to promote municipal mergers. So, prefectural governments are expected to support municipal efforts toward mergers actively. Municipalities are also expected to make efforts actively and voluntarily using the aid from the national and prefectural governments.
| i) |
Subsidy to Build Prefectures' Supporting System |
The FY 2001 budgetary bill includes the expense enough to aid twenty million yen per prefecture, the government of which conducts the following projects to take measures under the Guide actively. (The immediate distribution is fifteen million yen per prefecture, and the residual amount in the budget should be distributed additionally, according to the efforts of each prefectural government on their ISZM.)
| (a) |
Arrangement of supporting system (establishment
of supporting centers for municipal mergers, operation of it, etc.) |
| (b) |
Enlightenment of inhabitants (symposiums, lectures,
cooperatively-held survey to inhabitants, enlightenment to promote understanding
of inhabitants cooperated with private sectors, delegation of experts, etc.) |
| (c) |
Investigations (support for municipalities' making
of long-term forecasts on administration and finance, etc.) |
| ii) |
Subsidy to Prepare Mergers |
A fixed subsidy up to five million yen will be granted to the constituent municipalities of a council for merger, which was established after FY 1999 and make such efforts to make municipal constitution plans.
| iii) |
Subsidy for a Merged Municipalities |
A subsidy will be granted to the municipalities that merged by March 31, 2005, for the projects listed as necessary for a merger in the municipal constitution plan. The subsidy will be granted within three years after the mergers. And, the amount cannot exceed the total of ex-municipalities' amounts that should be calculated by population based on the following table. However, when the national government admits particular necessity, an amount for each year can exceed the annual cap to the extent that the sum of the annual amounts may not exceed the amount of three times of the annual cap.
| Population of Ex-municipalities (X) |
Amount (million yen) |
|
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20 |
|
|
30 |
|
|
50 |
|
|
70 |
|
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100 |
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In order to expand the exception of local taxation regarding to the merged municipalities, "the Bill to Amend Parts of the Local Autonomy Law and Other Laws," which has been committed to the 151st Diet, includes the following amendments. (These amendments will be applied to the mergers that occur after the Law comes into effect.)
| i) |
The period that the merged municipality can impose unequal
tax will be extended from the fiscal year when the merger was conducted plus the
following three fiscal years to the fiscal year when the merger was conducted
plus the following five fiscal years. |
| ii) |
When municipalities that pose such taxes as enterprise tax
and city planning tax and those do not are merged, there can be a region where
such taxes will be newly posed. In this case, such taxes will be able to be exempted
in the region during the same term as i). |
| iii) |
When a merger generates a city with the population of more
than 300 thousand, the city shall not be designated to pose enterprise tax, by
the time five years have passed after the merger. (However, this can be overruled
when the population of the merged city is more than the hypothetical population
calculated in a certain method where populations of constituent municipalities
as of the day just before the merger are taken into account.) |
| (3) |
Local Financial Measures |
| i) |
Financial Measure Using Special Local Allocation Tax to Merged
Municipalities (After FY 2000) |
As for the municipalities that merged by March 31, 2005, the following demands after mergers will be taken into account in calculating their special local allocation taxes during the year of merger and the following three years.
| (a) |
Such new municipal constructions as construction
of community centers and making of overall traffic plan due to mergers |
| (b) |
Coordination of the gaps in the public services
among the ex-municipalities |
| (c) |
Coordination of the gaps in the public loans among
the ex-municipalities |
| (d) |
More sound management of public corporation for
land development |
| ii) |
Financial Measure to the Expense to Merge (After FY 2000) |
Such expenses as to unify computer systems before mergers are taken into account in calculating special local allocation tax, so that constituent municipalities can swiftly accomplish unity.
| iii) |
Exceptional Calculation of Ordinary Local Allocation Tax ("Gappei-Santeigae") |
As for the municipalities that merged by March 31, 2005, the ordinary local allocation tax will be calculated so as not to fall below the total amount of each hypothetical ordinary local allocation tax that would be calculated without the merger during the year of merger and the following ten years. In the successive five years, the gain in the calculation will be gradually reduced.
| iv) |
Financial Measure to Construction Projects for Merged Municipalities |
As for the municipalities that merged by March 31, 2005, the expense for the projects under the municipal construction plan can be afforded by issuing local government bonds (Appropriation Rate: 95%, Merger Special Bonds). Seventy percent of the principal and interest that need to be paid will be regarded as the financial demand in calculating the ordinary local allocation tax.
| v) |
Financial Measures to Raise Funds for A Merged Municipality
Promotion |
As for the municipalities that merged by March 31, 2005, the expense to raise the fund for regional promotions in the ex-municipalities and creation of a sense of unity among inhabitants can be afforded by issuing local government bonds (Appropriation Rate: 95%, Merger Special Bonds). Seventy percent of the principal and interest that need to be paid will be regarded as the demand in calculating the ordinary local allocation tax.
| vi) |
Financial Measure to the Extraordinary Expense Immediately
after Mergers |
As for the municipalities that merged by March 31, 2005, the ordinary expenses for the followings will be generally taken into account in calculating their ordinary local allocation taxes during five years.
| (a) |
To unify such administrative systems as making
and revising of basic framework, unification of computer system, and arrangement
of the network |
| (b) |
Coordination of the gaps in the administrative
level among the ex-municipalities |
| vii) |
Financial Measure to the Expense of Prefectures to Support
Municipal Merger |
Prefecture's subsidies that have been granted to the projects of merged municipalities are taken into account in calculating prefectures' special local allocation tax.
| viii) |
Financial Measure to the Expense to Prepare Mergers |
Such expenses as payment to a council for merger and campaign for a merger to prepare for a merger are taken into account in calculating prefectures' special local allocation tax.
| ix) |
Financial Measure to Prefectures' Promotion for Municipal Mergers
(planned to be expanded from FY 2001) |
The prefectures' supporting expenses for investigation and promotion in ISZMs will be taken into account in calculating their ordinary local allocation taxes.
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