Japanese officials, worried about shifting demographics and a sharp decline in sin tax revenue, have come up with an unusual fix for their fiscal woes: encouraging young people to drink more.
The coronavirus pandemic exacerbated a decades-long decline in Japanese alcohol consumption, with residents eating and drinking out much less than usual. Although Japan never went into a full lockdown, a state of emergency was declared in Tokyo, with measures that included asking restaurants and bars to close early. At one stage during the pandemic, the sale of alcohol in restaurants was banned, while at other times it was restricted to certain hours of the day. While people drank more at home, overall alcohol consumption levels were lower than normal.
Liquor tax revenue in the fiscal 2020 year was about $8.4 billion, a plunge of more than $813 million from the previous year, according to government data. That was the largest decline in three decades — and a cause for alarm for a government facing broad fiscal challenges.
By 2020, alcohol consumption in Japan had fallen by about a third from the annual average of 26½ gallons per person in the mid-1990s, according to the country’s tax agency. Meanwhile, sales of nonalcoholic beverages — which aren’t subject to similar taxation — have grown in recent years, going by industry figures.
As in many economically developed places around the world, younger Japanese people are drinking less than older generations. A 2019 Health Ministry survey found that 29.4 percent of people in their 20s don’t drink alcohol at all, while 26.5 percent said they rarely drink.
The unorthodox push by bureaucrats to “revitalize the liquor industry” has faced a backlash on social media. No major Japanese alcohol manufacturers have publicly indicated their support.
“Young people not drinking is a good thing. Why make them addicts,” one user wrote on Twitter, in a post that attracted hundreds of likes. Another wrote: “As long as they can collect taxes, I guess people’s health doesn’t matter.”
The contest asks the participants to propose new ways to spur booze sales, including using artificial intelligence and tapping on the metaverse — the virtual universe that blends aspects of digital technologies such as virtual reality and augmented reality. Entries close Sept. 9 and finalists will be invited to a tournament in Tokyo in November.
It also calls for “new services and promotion methods” to stimulate demand among young people, and create products that take account of lifestyle changes brought on by the pandemic.
The Health Ministry couldn’t immediately be reached for comment.
Inuma reported from Tokyo.