Policy Overview

Carbon Taxes and Levies

Currently Japan has a carbon tax, called the Global Warming Countermeasures Tax set at 289 yen/t-CO2 (roughly USD 2.00). There have been discussions at various government consultations about raising this tax level or introducing a new tax.

GX Basic Policy

On December 22, 2022 the government unveiled the draft Green Transformation (GX) Basic Policy. Under this strategy the Japanese government aims to raise initial 20 trillion yen (USD 140 billion) through ‘GX Bonds.' They will be repaid through ‘carbon pricing’ revenues that combine a ‘carbon levy’ to be introduced in 2028, and voluntary emissions trading introduced in 2023 and expanded to the power sector with allowance auctions in 2033.

A carbon levy will be gradually introduced from 2028 on power, gas and oil companies. While the government has not disclosed the price, the Renewable Energy Institute estimates that it will amount to a carbon price equivalent of up to 1,500 yen/t-CO2 (Less than USD 12/t-CO2) under current assumptions disclosed by the government.

Evidence Profile

7880301511

Key

opposing not supporting mixed/unclear
supporting strongly supporting

Policy Engagement Overview

The overall corporate and industry engagement on carbon taxes in Japan shows strong opposition from cross-sector industry associations and groups representing the heavy-industry including steel, petrochemicals, and electric utilities such as Keidanren, Japan Iron and Steel Federation (JISF), Federation of Electric Power Companies (FEPC), and Petroleum Association of Japan (PAJ).

Most individual corporations have not expressed position on carbon taxes, while Itochu stated support with minor exceptions, and Nippon Steel showed opposition emphasizing the cost of carbon taxes.

Policy Engagement Trends

The Japan Climate Leaders Partnership (JCLP) has strongly supported the introduction of carbon taxes in a policy recommendation on November 2022.

However, Keidanren, Japan Iron and Steel Federation (JISF), Federation of Electric Power Companies (FEPC), Petroleum Association of Japan, Japan Society of Industrial Machinery Manufacturers (JSIM) have strongly opposed a carbon tax. Japan Gas Association, Japan Chamber of Commerce and Industry (JCCI) and also do not appear to be supportive of carbon taxes.

The Scheduled Airlines Association of Japan appeared to “keep eye on” carbon tax without expressing a clear opinion on it.

Most companies have not expressed a clear position on carbon taxes. Although ITOCHU supports a carbon tax with minor exceptions, emphasizing cost concerns of a carbon tax. Nippon Steel has expressed opposition, stressing high costs and reduction resources of technological development and capital investment.

Evidence Profile

7880301511

Key

opposing not supporting mixed/unclear
supporting strongly supporting

Live Lobbying Alerts

石油連盟は特定の炭素税政策に反対している

20 January 2023

石油連盟は11月16日、石油諸税の引き下げを訴えるために、国会議員109名を含む「総決起集会」を開催した。そこで「さらなる石油増税や炭素税の導入には絶対反対!」と主張した。

JISF supports Japan's 2050 goal while opposing environmental taxation policies

07 October 2022

In a position paper on the fiscal 2023 tax reform, published on its website on September 29th, Japan Iron and Steel Federation (JISF) advocated against the carbon tax, Tax for Climate Change Mitigation, and emissions trading, while stating support for Japan’s 2050 carbon neutrality goal. It also advocated for tax exemptions for coking coal used in steel production and stated that thermal power generation “will continue to be necessary in the future.” Additionally, it requested increased financial support for technological development to decarbonize steel production, as well as “carbon-free electricity and hydrogen,” while supporting hydrogen reduction steelmaking, without specifying a position on its decarbonization.

Entities Engaged on Policy

Influencemap Performance BandOrganizationEngagement Intensity
D-Nippon Steel Corporation31Metals & MiningAsia
E+Japan Iron and Steel Federation (JISF)44Metals & MiningAsia
D+Japan Business Federation (Keidanren)50All SectorsAsia
DENEOS Holdings (formerly JX Holdings Inc)29EnergyAsia
A-Japan Climate Leaders Partnership (JCLP)39All SectorsAsia
DJapan Chamber of Commerce and Industry (JCCI)26All SectorsAsia
DPetroleum Association of Japan (PAJ)29EnergyAsia
DToray Industries Inc.14ChemicalsAsia
DJapan Chemical Industry Association (JCIA)19ChemicalsAsia
DFederation of Electric Power Companies of Japan (FEPC)36UtilitiesAsia
B+Renewable Energy Council (REC)19UtilitiesAsia
B-Japan Association of Corporate Executives (Keizai Doyukai)38All SectorsAsia
DJapan Gas Association26EnergyAsia
D+Central Japan Economic Federation (CJEF)20All SectorsAsia
D+ITOCHU11Business ServicesAsia
DJapan Paper Association (JPA)10Paper & Forest ProductsAsia
D+Mitsubishi Corporation23IndustrialsAsia
DJapan Society of Industrial Machinery Manufacturers (JSIM)10IndustrialsAsia
DKansai Economic Federation12All SectorsAsia
D+Japanese Shipowners' Association (JSA)14TransportationAsia
B-Takeda Pharmaceutical16HealthcareAsia
D-Scheduled Airlines Association of Japan5TransportationAsia
D-Suzuki19AutomobilesAsia
DToyota Motor40AutomobilesAsia