Record tax revenues underscore the critical role of international investment in the Niseko area
Foreign property owners have, for the first time, contributed more in fixed asset tax than Japanese nationals in Kutchan, highlighting just how central international investment has become to the local economy of the Niseko region.
According to the town’s 2024 fiscal year accounts, foreign owners paid ¥12.83 billion in fixed asset tax, surpassing the ¥11.47 billion paid by Japanese owners. Local authorities note that this is believed to be the first instance of foreign taxpayers exceeding domestic taxpayers in fixed asset tax contributions within any municipality in Hokkaido.
The primary driver has been continued overseas investment in resort-oriented real estate across the wider Niseko area, including Hirafu, Hanazono, and Iwaobetsu. These investments—largely aimed at resort development and accommodation—have accelerated over recent years as global demand for Niseko’s year-round lifestyle and tourism offering has grown.
Property tax reaches historic high
Foreign contributions rose sharply year-on-year, increasing by 54%, while payments from Japanese owners declined by 16%. Although Kutchan Town does not publish a country-by-country breakdown, officials report that investors from Australia and Hong Kong—both individuals and corporations—are particularly prominent.
Total fixed asset tax revenue reached a record ¥24.31 billion, up 10.5% from the previous year. To put that into perspective, this level of property tax revenue is comparable to municipalities in Hokkaido with populations of around 40,000—despite Kutchan Town having a population of just approximately 15,000 residents.
Crucially, fixed asset tax now accounts for around half of Kutchan’s total tax revenue, making it one of the single most important pillars of the town’s public finances.
Rising land values and new developments
The expansion of foreign-owned land has been significant. In fiscal 2024, the total area of resort land owned by foreign entities increased by 28% to 10.82 million square metres—roughly equivalent to 230 Tokyo Domes.
Land price growth has further amplified tax receipts. As of July 1 this year, Kutchan’s average benchmark land price across all uses rose 13.4% year-on-year to ¥92,800 per square metre, exceeding prices in several wards of Sapporo. New large-scale developments have also contributed to higher assessed values.
International capital as a fiscal backbone
Town officials have been explicit about the importance of this trend. Kutchan’s tax department described fixed asset tax as making an “extremely significant contribution” to the town’s finances.
Looking ahead, the town expects both foreign and Japanese contributions to rise further in fiscal 2025, with total fixed asset tax revenue forecast to reach ¥27.1 billion. New accommodation developments backed by capital from Hong Kong, the Philippines, Singapore, and elsewhere are already in the planning pipeline.
A uniquely international model—by Japanese standards
While debates around foreign ownership and development continue, the numbers tell a clear story: Kutchan’s infrastructure, public services, and long-term financial stability are now deeply supported by responsible international investment.
There are, of course, irresponsible investors—foreign and domestic alike. But this data underscores an often-overlooked reality: in Kutchan, and particularly in Niseko, overseas capital is not a marginal influence. It is a core component of the town’s fiscal health, and there is nowhere else in Japan where this dynamic exists at such scale.
Source: Hokkaido Shimbun (Japanese only)