The levy was created by the 2024 child policy legislation to pay for a package of measures: larger child allowances with no income limit, extended to high-school age, higher benefits for parents on leave, and new childcare services. The government chose to collect it through the health insurance system rather than raise taxes, and it applies to everyone in public health insurance, not only to parents.
Collection began with April 2026 contributions, usually deducted from May pay. For employees in the Japan Health Insurance Association and company health insurance societies, the rate is 0.23% of standard monthly remuneration and of bonuses in fiscal 2026, split equally, so 0.115% from each side. It is being phased in: total collection is planned at about 600 billion yen in fiscal 2026, 800 billion yen in fiscal 2027 and about 1 trillion yen in fiscal 2028, when the rate is expected to reach around 0.4%. People in the National Health Insurance pay a separate portion with its own cap of 30,000 yen a year.
It should not be confused with the older child-rearing contribution, a separate charge of 0.36% of pay that only the employer pays, collected with pension contributions.
What it means for a foreign employer
- It is a small, rising cost. At 0.115% for the employer in fiscal 2026 it barely moves the budget, but plan for roughly double that by 2028.
- Payroll must show it. Many employers list it as a separate line on payslips, and employees ask what it is.
- Two child charges now exist. Make sure the payroll provider applies both the new shared levy and the older employer-only contribution.
- Leave rules carry over. Employees exempt from health and pension contributions during childcare leave are exempt from the levy as well.
Sources
- Act Partially Amending the Act on Child and Child-rearing Support, enacted June 2024.
- Children and Families Agency, explanation of the support levy and its phase-in.
- Japan Health Insurance Association, fiscal 2026 levy rate; Japan Pension Service, fiscal 2026 child-rearing contribution rate.