The Hyogo Prefecture government in Japan is facing a financial crisis, but fortunately an anonymous donor has come to the rescue by donating 35 kilograms of gold bars worth a whopping 8.3374 billion Japanese yen (approximately 5.4 million U.S. dollars), injecting a much-needed boost into the prefecture’s finances.
According to a report by Japan’s “Mainichi Shimbun,” this is the largest individual donation amount that Hyogo Prefecture has ever received. The prefectural government plans to sell these gold bars and allocate the funds into local development projects in accordance with the donor’s wishes.
Governor of Hyogo Prefecture, Genichiro Saito, announced during a press conference on September 16 that the anonymous donor first contacted the prefectural government about the donation in February. After several discussions, the prefectural government officially received the 35 kilograms of gold bars on September 8.
Saito expressed his deepest gratitude on behalf of the residents of Hyogo Prefecture for this generous act of kindness. He also shared the heartwarming news on the social media platform X, where it has garnered 2.41 million likes.
Last month, Hyogo Prefecture was designated as a “debt issuance consent group” by the Japanese central government. Moving forward, the prefecture will require national approval to issue public bonds. If its financial situation remains unchanged, the prefecture will be classified as a local government in need of financial restructuring in the fiscal year 2031, indicating a perilous financial state.
Tax accountants interviewed by the “Tokyo Reporter” website suggested that the reason the anonymous donor chose to donate gold bars instead of wire transferring funds directly to the government was mainly to avoid hefty tax obligations associated with large monetary donations.
If the donor were to sell the gold bars themselves, they would incur high transaction fees and hefty taxes, including up to 45% income tax and 10% resident tax on profits. It is estimated that selling the 35 kilograms gold bars on their own would yield around 600 million yen after taxes. However, by donating the gold bars directly to the local government, the government can liquidate them tax-free and access their full market value.
This is not the first time that Hyogo Prefecture has received substantial donations. In the past year alone, the prefecture has received donations totaling 1.82 billion yen from individuals and corporations. The 35-kilogram gold donation is equivalent to approximately half a year’s worth of private funding.
Hyogo Prefecture is not the only local government to receive significant gold bar donations. In May 2023, 87-year-old Natsuo Nakajima donated gold bars worth approximately 280 million yen to Minoh City in Osaka.
Additionally, in February of this year, Osaka Mayor Hideyuki Yoko announced during a press conference that an anonymous donor had donated gold bars worth up to 560 million yen to the city, with the proceeds earmarked for repairing the city’s aging water pipelines.