Influence of the Settsu' Suit on the Local Allocation Tax System

Abstract

The Settsu case involved an attempt by a municipality to induce the central government to disburse the shortfall of the grant required for the construction of four preschools. This paper presents the manner in which the Settsu suit affected the determination of the standard financial requirements of the local allocation tax system. There have been few arguments with regard to the Settsu suit in the domain of local public finance because its documents in the Ministry of Home Affairs did not adequately support the issue. Moreover, although the Settsu suit might have been a crucial event, little is known about its influence on the local public finance system. This paper focuses on the influence of the suit on the local allocation tax system that controls municipalities.