Abstract
The so-called “1.03 million yen income wall,” where married part-time women adjust their annual earnings below ¥1.03 million, has attracted significant political and social attention in Japan, especially amid the 2025 tax reform discussions. Interestingly, even under previous tax schemes where the increase in tax burden beyond ¥1.03 million was minimal, tax data showed that many married women still adjusted their income to stay under that threshold. Against this background, this study aims to assess whether accurate information provision about the tax system can alter labor supply adjustment behavior.
We extract 50% of all women aged 25–60 residing in a voluntarily participating city randomly. This randomly drawn 50% of women living in the city will receive informational content about the tax system embedded in a survey format. The study will evaluate whether this intervention affects labor supply behavior by analyzing 2025 income data.
The participating city and the Center for Research and Education in Program Evaluation (CREPE), University of Tokyo, have signed a data-sharing agreement to provide access to local resident tax records. The researchers use anonymized local government resident tax records via CREPE.
The “Survey on Taxation and Labor Supply Adjustment” will be conducted jointly with the city government. The survey will collect self-reported information such as labor supply behavior in 2024 and intentions for 2025, educational background, and other attributes not available in tax data. Additionally, the survey form will include a tax and social insurance summary table (e.g., income vs. take-home pay) to serve as an information provision tool. Even if respondents do not complete the survey, the research team will receive information from the city indicating whether individuals were included in the mailing list, allowing estimation of the intent-to-treat (ITT) effects.
Detailed Procedures and Timeline:
1. April–May: CREPE provides the city with a code to randomly extract 50% of eligible women and assign anonymized IDs. The city applies this code to resident tax records.
2. April–May: Using pre-2023 tax data, the city:
(1) Generates anonymized tax data with IDs → Provided to researchers via CREPE
(2) Creates mailing labels with corresponding IDs → Sent to mailing contractor
3. June: Contractor prepares and mails survey packages (cover letter, paper survey with QR code and tracking ID, return envelope)
4. June onward: Respondents complete the survey online or by mail. Online responses are received directly by researchers; mail responses are sent to the city, which forwards only anonymized content to researchers.
5. Fall 2026: Tax data for FY2024–2025 (based on 2025–2026 incomes) are provided by the city to CREPE, using the same hash ID system for linkage with earlier data.