Government ministries and agencies are expected to submit preliminary budget requests by the end of August 2026. The Cabinet has agreed on the criteria for FY2027 preliminary budget requests, which are expected to include a new proposal allowing unlimited requests under the Strong and Prosperous Japan Investment framework.
Under the criteria for FY2027 preliminary budget requests agreed by the Cabinet on 30 July 2026, a new Strong and Prosperous Japan Investment framework is expected to be introduced. The proposed system would remove the ceiling on ordinary expenditures and allow requests for the amounts required. The criteria also indicate that item-specific requests will be permitted, increasing flexibility in budget allocations for strategic fields such as GX, AI and semiconductors.
The deadline for submitting preliminary budget requests is the end of August each year, after which the Ministry of Finance reviews the requests and compiles the government’s draft budget. Following submission at the end of August, the total amount is announced in early September. The budget is compiled from September through December, the government’s draft budget is approved by the Cabinet in late December, and it is debated in the ordinary session of the Diet from January of the following year, with enactment expected at the end of March.
The FY2026 budget process also involved the preparation of a provisional budget, with one case providing for a provisional period from 1 April to 11 April. The policy for FY2027 explicitly calls for moving away from reliance on supplementary budgets, which could also affect the schedule for new subsidy programs.
Basic Policy 2026 was approved by the Cabinet on 21 July 2026 and provides the foundation for the preliminary budget request criteria, anticipating the direction of subsidy policy. According to publicly available information, securing funding for growth sectors is expected to be a priority in the budget process for the following fiscal year.
The overall process from preliminary budget requests to budget enactment generally consists of submissions at the end of August, budget reviews from September through December, Cabinet approval in late December, deliberations in the ordinary session of the Diet from January of the following year, and budget enactment at the end of March.
The timing of subsidy program openings may be affected by the status of the initial budget’s enactment. To anticipate support measures for the following fiscal year, attention will therefore be focused on information published after the end of August.