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Two key focuses of forestry in Japan today are making use of the many functions of forests and taking measures against global warming. Until around 1975, the main aim of forestry was timber production; however, as timber prices fell, forestry became financially unsustainable. Following that, utilization of multiple functions of forests and measures against global warming were newly included among the objectives of forestry, which gave rise to government subsidies, forest-related public projects, and measures to maintain forests for CO2 absorption. In addition, the Forestry Agency has exerted effort to promote green infrastructure as it maintains forests, with the idea that forests constitute “green social capital.”
When the main purpose of forestry was timber production (until about 1975), revenue from timber sales was used to find investment in forests and pay for maintenance. Part of the revenue generated from national forests was also included in the government’s general-purpose funds. However, falling timber prices drove revenues below costs, which led to the use of public funds for forest maintenance. For measures against global warming, too, the government’s general-purpose funds have been used to pay for additional forest maintenance. The Paris Agreement necessitates even further efforts for forest maintenance. This requires generalpurpose funds along with new funding sources for forest-based CO2 absorption. Accordingly, the Forestry Agency has requested that the taxation system expand the ways in which revenue from the global warming tax can be used, and has asked for an additional tax to pay for forest maintenance.
In response to these trends, industry, which has supported forest maintenance activities in the past, is opposing the expanded use of revenue from the global warming tax, and local governments are opposing the double taxation that would arise from a forest maintenance tax. In this context, this paper summarizes trends and possibilities regarding new and existing funding sources for use in combating global warming and maintaining green infrastructure.