Where Japan's program sits in 2026
Japan doesn't have a tax credit or a standing rebate written into law. Its national location incentive is a subsidy that the Ministry of Economy, Trade and Industry funds out of supplementary budgets and renames every year or two. From 2023 to early 2026 it ran as JLOX and JLOX+, operated by VIPO, with a 50% rate and a JPY 1 billion cap. For the FY2025 supplementary budget METI folded it into a package called IP360 as Menu 4, "large-scale production support (location attraction)". The Japan Arts Council runs the secretariat, the rate is still one half, and the cap went up to JPY 1.5 billion per project.
The timing problem for anyone planning a shoot now: the second call opened June 30, 2026 and closed July 21, 2026, and the Japan Arts Council notice says that was the last new call of the fiscal year. A show prepping for spring 2027 should assume it needs the next budget cycle and ask the Japan Film Commission when that call is expected.
Who applies and what METI screens for
The applicant is a Japanese live-action production company that produces with, or is contracted by, the overseas studio. METI excludes companies that only develop or only invest without doing production work, and companies formed under foreign law can't apply for this menu. Each title is a separate application.
METI's published screening criteria for Menu 4:
| Criterion | Threshold |
|---|---|
| Applicant track record | Best previous title as prime contractor earned at least JPY 1 billion |
| Japan production costs | At least JPY 800 million |
| Funding commitment | Committed financing divided by Japan production costs at least 50% |
| Overseas release | At least one country outside Japan |
| Localization | At least one language other than Japanese |
| Rights | Japanese corporate equity in the title under 50% |
Bonus points go to bigger total budgets, more overseas crew traveling to Japan, VFX work done in Japan and more minutes of Japan scenes in the finished work.
What counts and what doesn't
Only production and post-production (localization included) are eligible, so development and prep before the grant decision are out. Within those stages the eligible buckets are labor, travel, equipment, rentals, communications, freight, contractor fees and consumables. The exclusions list is specific and worth sending to your accountant before the budget is locked: Japanese consumption tax, general overhead, the cost of the subsidy report itself, travel for anyone other than principal personnel, optional insurance, souvenirs, meals that aren't formal hospitality (METI names cast and crew bento and meeting dinners), and vague lines such as contingency or "adjustments". Payments to foreign companies for the eligible stages are also out, which means an offshore VFX vendor billing the Japanese applicant doesn't count.
Worked example
An American streaming series shoots six weeks in Tokyo and Kyoto. The Japanese service company's budget for Japan is JPY 1.2 billion. After removing consumption tax, crew meals, contingency and a foreign-billed VFX package, the eligible base is JPY 1.0 billion.
| Line | Amount |
|---|---|
| Japan production costs (screening figure) | JPY 1,200,000,000 |
| Eligible costs after exclusions | JPY 1,000,000,000 |
| Subsidy at 50% | JPY 500,000,000 |
Scale it to a feature with JPY 4 billion of eligible Japan costs: half is JPY 2 billion, so the JPY 1.5 billion cap applies and the effective rate falls to 37.5%.
The amount approved at grant decision is a ceiling. VIPO's guidance for the earlier rounds said the final figure is set after inspecting the results report and can be cut for thin documentation, and the new menu asks for a cost report, shoot and post logs (wrap reports and comp lists are accepted) and schedules (call sheets and one-liners are accepted). Keep your cost report coded so Japan costs can be pulled out cleanly.
Watch-outs
- The subsidy period ends at the end of February 2028 for multi-year projects, and the results report is due within 90 days of finishing or by the program deadline, whichever comes first.
- Partial advance payments are allowed where the production needs the cash flow.
- You can't claim the same cost under two subsidies, national or local. Several regional film commissions run their own shooting subsidies, so allocate costs deliberately.
- The funding pot is finite and calls close when it's spent.
Japan against its neighbor
South Korea runs a much smaller, first-come cash rebate through KOFIC at 25% of Korean spend with a low per-project ceiling, so it suits mid-size shoots that Japan's JPY 800 million bar would exclude. Japan's 50% is one of the highest headline rates anywhere, but the screening bar and closed call windows make it a tool for large studio projects. For the broader case on moving a shoot overseas, read tax incentives and global film production, and use the incentive calculator or the incentives hub to compare. Keep in mind that "qualified spend" in Japan is narrower than the local budget total.