The Japanese government officially launched the 'Japanese version of DOGE Government Efficiency Department' review mechanism on the 25th of this month, aiming to comprehensively review special tax policies and government subsidies, strengthen fiscal discipline, and reduce waste. The Cabinet Secretariat will establish a new office soon, with about 30 staff members from different ministries involved in the review, responsible for inventorying the 'hidden subsidies' and tax incentives that have been difficult to address for many years. Finance Minister Katayama stated at a press conference that he will widely solicit public opinion through social platforms such as X, emphasizing that reform requires societal support.
Japanese Prime Minister Sanae Takaichi clearly instructed Finance Minister Katayama and relevant Cabinet members to cooperate in promoting reforms. Takaichi believes that the long-accumulated problems of the special tax system and subsidy structure urgently need to be reassessed. Internal government sources also revealed that Cabinet Secretary Kihara is expected to serve as the head of the Efficiency Department. What kind of policy impact will the Japanese version of DOGE have on the Liberal Democratic Party led by Sanae Takaichi? Japanese media are actively discussing this topic. This article is excerpted from Hiroyuki's warning: 'Will the Japanese version of DOGE only create new waste? Is a reduction of 33 trillion yen feasible? What is the Government Efficiency Bureau?'
The name 'Japan's version of DOGE' is derived from the U.S. reform agency of the same name established by Musk.
The so-called 'DOGE' originates from the 'Government Efficiency Department' established by the U.S. government earlier this year. This department, led by Musk as chief advisor, is known for its strong reforms, having frozen the operations of the U.S. Agency for International Development and laid off a large number of administrative personnel. Although it claimed to have significantly saved budgets, it also caused negative consequences such as union lawsuits and stagnation of public services, leading to Musk's resignation in May. Japanese media refers to the newly established unit of the Japanese government as 'Japan's version of DOGE,' implying its reform intensity and political risks.
Experts and political figures: Can Japan replicate the 'DOGE reform' of the United States?
Regarding whether Japan can promote efficiency reforms similar to those in the United States, opinions among Japanese civil society, the political sphere, and academia vary. Some commentators believe that Japan's administrative system has gradually examined waste over the years through political reviews and administrative business reviews, and that the real space to 'cut several trillion yen from the budget' is actually limited.
Some comments point out that Japan has attempted to reorganize spending during the ruling periods of the Liberal Democratic Party, Komeito, and the Democratic Party, but typically only stays at the level of 'maintaining the status quo after reducing a few items,' making it difficult to address structural reforms. Some interviewees bluntly stated, 'Establishing efficiency departments often becomes a formality, ultimately just a new bureaucratic institution.'
Former chairman of the Growth Committee Aoyanagi from the Restoration Party, as well as experts involved in administrative reforms, have pointed out that Japan's current administrative processes have accumulated too many vested interests, and without clear political will, it is difficult to promote real reductions.
The special tax system is regarded as the largest 'black box'; the Japanese government will finally take action.
Many experts attending the discussion pointed out that Japan's special tax system has long been seen as a 'black box.' The targets of tax reductions include agricultural-related practitioners, companies that raise salaries, and companies that invest in research and development, among others. Various tax exemption systems are described as 'another form of subsidy.' In addition, these tax measures are actually unprecedented, as they have not been included in administrative item reviews. The reason is that Japan's tax system is very special; special revitalization measures are tax reductions aimed at specific enterprises and specific types of individuals. Special tax reduction measures provide tax reductions for those engaged in agricultural activities or for full tax payments on land expropriation; companies that make efforts to hire a large number of employees, raise wages, engage in research and development, or construct sanitary facilities will also receive tax reductions. In practice, this is almost indistinguishable from subsidies.
Subsidies are usually subject to audits and inspections, while special tax systems lack transparency and often become sources of interest for 'tribal politics' or specific industry groups. The new government hopes to open the black box for the first time through 'Japan's version of DOGE,' inventorying the special tax reduction items that have been repeatedly extended in the past.
However, some commentators warn that there is strong support within the Liberal Democratic Party for the special tax system, and reforms are bound to face immense resistance. Some experts believe that if there is a need to fill the tax revenue gap caused by the abolition of the temporary gasoline tax, canceling certain special tax reductions is indeed reasonable, but politically very challenging.
The scale of subsidies and reduction targets are questioned: Setting a 'trillion yen level' target has been criticized as unrealistic.
During the discussion, there were also questions about the setting of reform targets. Some people pointed out that if the government sets a target of 'cutting several trillion yen' without thoroughly reviewing the items, it may repeat the past mistake of 'cutting hard to achieve numbers,' ultimately sacrificing necessary investments.
Some participants with experience in administrative reviews recalled the situation during the Democratic Party era when 'political reviews' were broadcasted live on television, believing that it focused too much on 'political theater themed around waste,' making it hard for society to truly understand the functionality and necessity of policies.
Many experts emphasize that some expenditures cannot be measured by simple cost-effectiveness, such as investments in technological research and development, supercomputers, etc. If the focus is solely on short-term reductions, it may actually harm the country's future competitiveness.
Digitalization and local government system issues: Reforms may fall into the limitations of local autonomy.
Discussions also extended to digital reforms. Some experts criticized that Japan's more than 1,700 local governments still establish their own information systems, resulting in enormous waste. Although the digital director proposed a reference model, there is a lack of compulsion, and the central government cannot require local governments to unify their systems.
Some scholars believe that Japan's local autonomy system itself limits the central government's ability to promote comprehensive reforms. If the legal system does not change, even if the efficiency department is established, it will be difficult to exert substantial influence on waste in local administration.
The core dilemma of Japan's reform: political will and social consensus.
Several interviewees summarized that the problem does not lie in whether to establish new institutions, but in whether the political leadership is willing to bear the political costs of reducing subsidies and resisting interest groups. Some pointed out, 'It is almost impossible to find a budget reduction plan that everyone agrees on.' Others believe that genuine reform requires strong political will as demonstrated by the Osaka Restoration.
Despite numerous controversies, the launch of Japan's version of DOGE is still seen as a symbol of the new government's determination for reform. Whether substantial results can be achieved in special tax systems, subsidies, and administrative efficiency will be a key indicator of the government's reform capability.
This article announces that Takagi Sanae has officially launched the Japanese version of the 'DOGE Government Efficiency Department,' targeting reform in special tax systems and subsidies, first appearing in Chain News ABMedia.
