Name in original language
オープンイノベーション促進税制
Initiative overview
Introduced as part of the FY2020 Tax Reform (effective 1 April 2020) and administered by METI and the National Tax Agency, the Open Innovation Promotion Tax System allows eligible blue-return corporations to deduct 25% of the acquisition cost of qualifying startup shares from taxable income in the year of acquisition, subject to statutory conditions. The deducted amount is booked to a special account and reversed into taxable income if defined trigger events occur (such as disposal of shares). Investment thresholds: a minimum of ¥100M for acquisitions in domestic Japanese startups; ¥500M for foreign-based startups; ¥10M for SMEs investing in domestic startups. The target startup must be unlisted, incorporated, and have commenced operations within the past 10 years. An M&A-type variant was added for transactions from 1 April 2023, covering majority voting-right control acquisitions. Under the FY2026 Tax Reform Outline (agreed 19 December 2025, enacted March 2026), the application period was extended by a further two years, moving the end date from 31 March 2026 to 31 March 2028.



























