Understanding the Spousal Special Deduction: A Guide to Japan’s Tax Benefits for Couples

Introduction The Spousal Special Deduction is a crucial component of Japan’s tax system, designed to provide financial relief to married couples by allowing one spouse to deduct a portion of their income when the couple’s collective earnings fall within certain thresholds. This paper aims to explore the details and implications of the Spousal Special Deduction, examining its purpose, criteria for eligibility, and its impact on family finances in Japan. By analyzing the structure and effects of this deduction, the report will clarify how this tax benefit supports households and contributes to broader economic stability.

The Spousal Special Deduction: An Overview The Spousal Special Deduction, or “配偶者控除” (Haiguusha Kōjo), was established to promote family welfare by alleviating the tax burden on lower-income households. The deduction allows a taxpayer to reduce their taxable income based on their spouse’s income, thereby lowering their overall tax liability. To qualify for this deduction, the couple must meet specific income thresholds, with the lower-earning spouse’s income o