Overview of the Business Restructuring Subsidy (6th Round)

The overview document for next fiscal year's Business Restructuring Subsidy has been updated. It is hard to notice because the update date on the official website was not quietly changed, but if you download the document, it is now 'Version 2.0'. It appears to have been updated on February 25th.

Now, let's take a look at the contents.

Will the 6th round of public applications start in late March 2022!?

Since the 5th round of applications is currently underway, I thought the 6th round would be in April or later. But, wow, the application period is starting from late March.

In short, this means that the application guidelines for the 6th round will be released in March. It feels like, 'Is this for real?', but if it is true, it will likely be around the end of this month (March).
This allows business operators to plan without a time lag, which suggests that the system operation has been improved.

What is the application deadline for the 6th round?

The application deadline for the 6th round should be after the announcement of the 5th round selections.
The announcement for the 5th round is scheduled for late May to early June, and I suspect it will be in early June.

If so, the application deadline for the 6th round will be late June at the earliest. It could potentially be in July or August, but if you are preparing for the 6th round application from now, it would be better to assume late June as the target.

The target period for advance commencement has been changed to 'on or after December 21, 2021'!

The target period for the 'advance commencement' system, which allows orders to be placed before the grant decision, will be changed. There was prior information about this, but this is the first time the period has been clearly specified.

If the order date is 'on or after December 21, 2021', it is eligible. Since orders placed from now on will be eligible, those considering applying for the 6th round should be relieved.

On the other hand, for those who have already placed orders, the 5th round will be the last chance. That makes one anxious, doesn't it?

Other points to note

Other points of concern were summarized in a previous article, but let's list them again.

The maximum subsidy amount will be reduced!

For the 'Normal Category' used by many companies, the maximum subsidy amount will be reduced.

For businesses with 20 or fewer employees, the limit was 40 million yen this fiscal year, but it will be 20 million yen next fiscal year. It will be cut in half.

If you are considering building renovations or large-scale equipment installation, whether you can make it in time for the 4th round (deadline: December 21, 2021) or the 5th round (deadline: around March 2022) of this fiscal year will be the deciding factor.

The subsidy rate remains unchanged at 2/3 (for small and medium-sized enterprises, up to 60 million yen).

Building costs, new construction is basically not allowed!?

The Business Restructuring Subsidy was a new subsidy program that previously did not exist, as it allowed for new building construction as an eligible expense. However, for the next fiscal year, it will be 'in principle, limited to renovations only'.

It states, 'In the case of new construction, certain restrictions will be imposed.' I wonder what kind of restrictions those are?

The expression 'in principle, limited to renovations' seems like it will be a fairly strict limitation.

In that sense, for those considering new construction, this fiscal year is the last chance.

Sales decline requirements slightly relaxed

This fiscal year, the comparison was mainly based on October 2020 onwards, but for the next fiscal year, you can use April 2020 onwards as a uniform comparison period. Since the target period has expanded, more companies will meet the requirements. This feels like a slight improvement.

A 'Green Growth Category' will be established as a new category

Initiatives aligned with the Green Growth Strategy will be eligible, and the maximum subsidy amount is 100 million yen (for small and medium-sized enterprises) and up to 150 million yen for mid-sized enterprises, which is higher than this year.

CO2 reduction and carbon neutrality (making total CO2 emissions zero) are the main themes.

It must fall under the 14 fields of the Green Growth Strategy 'Action Plan'. So, you might be wondering, what are those 14 fields? It seems to be this.

https://www.meti.go.jp/press/2021/06/20210618005/20210618005.html

There was also a detailed explanation here.

https://www.meti.go.jp/policy/energy_environment/global_warming/ggs/index.html

The target fields are quite broad, and even agriculture, forestry, and fisheries are included, but please do not mistake this, as the focus is strictly on initiatives for CO2 reduction and carbon neutrality.

This article was written by
Mousou Biz Planning Representative Shigeki Kawahara
https://mousoubiz.com/
https://twitter.com/mousoubiz

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