Summary of the latest trends and changes in manufacturing subsidies

Check out the latest information on manufacturing subsidies! We explain how to apply, changes, and deadlines. Use it to support your business!

Overview of the manufacturing subsidy

The "Manufacturing Subsidy" is an important national subsidy system that supports innovative product development, service provision, and capital investment to improve production processes undertaken by small and medium-sized enterprises and small businesses. Its official name is the "Manufacturing, Commerce, and Service Productivity Improvement Promotion Subsidy," and it supports a variety of initiatives aimed at improving productivity.

This subsidy is targeted at a wide range of businesses that contribute to strengthening corporate competitiveness and sustainable business growth, and as such, many companies are using it to develop new businesses and undertake DX (digital transformation) and GX (green transformation) initiatives.

The manufacturing subsidy is administered by the Ministry of Economy, Trade and Industry and implemented by the Small and Medium Enterprise Agency. The National Federation of Small Business Associations, a general incorporated association, serves as the secretariat and manages the entire process from public solicitation to selection, project implementation, and performance reporting.

◆Basic application conditions

To apply for the manufacturing subsidy, you must meet the following main conditions:

• Capital and employee requirements: It is necessary to meet the requirements for small and medium-sized enterprises as set out in the Small and Medium Enterprise Basic Law.
• Project implementation plan requirements: Employers are required to formulate business plans that include wage increase plans and achieve targets such as the average annual rate of increase in added value and the average annual rate of increase in total wage payments.
• Project implementation period requirements: Projects must be implemented and results reported within a maximum of 10 months from the grant decision date (but up to 12 months from the announcement date of the grant). For the Global Market Development category, the maximum period is 12 months (but up to 14 months from the announcement date of the grant).

These conditions may be set in detail for each public offering, so it is important to be sure to check the latest public offering guidelines.

◆Types of eligible businesses

The manufacturing subsidy is primarily targeted at the following types of businesses:

• High-value-added products and services: Businesses that develop innovative new products and services
• Global Market Development Scheme: Businesses working to expand and strengthen overseas business

◆ Support amount range and percentage

The amount of support provided by the manufacturing subsidy varies depending on the application frame and the number of employees of the company.

• Maximum subsidy amount: The amount is set between 750 million yen and 2,500 million yen depending on the number of employees (however, the global limit is a flat 3,000 million yen regardless of the number of employees).
• Subsidy rate: As a general rule, the tax rate is 1/2 for small and medium-sized enterprises and 2/3 for small enterprises and small businesses.

◆ Judging criteria and selection points

The screening for the manufacturing subsidy is based on a comprehensive evaluation of the feasibility and innovativeness of the overall business plan, the degree to which it contributes to solving management issues, etc. The main screening criteria are as follows:

• Eligibility for Grants: Check whether the project meets the subsidy system's purpose and eligibility requirements
• Management skills: Evaluate the basic strength of the business and efforts to improve management
• Business feasibility: Evaluate whether the business you are applying for can generate profits and continue to grow
• Feasibility: Evaluate whether your plan is realistic and achievable
• Policy aspect: Evaluate the degree of alignment with national and regional policy goals

In order to pass the screening, it is essential that these items are described logically and specifically in the business plan.

◆The process from application to adoption

The schedule for the 21st call for applications is as follows:

• Recruitment starts: 2025.7.25 (Fri)
• Application acceptance: April 2025, 10 (Fri) 3: 17-
• Application Deadline: Friday, July 2025, 10 24:17
• Announcement of acceptance: Scheduled for late April 2026

To apply, you will need to obtain a G Biz ID Prime account in advance.

◆Latest changes and updates

The manufacturing subsidy is subject to minor changes each fiscal year or each public offering, in line with socio-economic conditions and government policy goals. In the 21st public offering, support for wage increase requirements is expected to continue to be strengthened.

◆Major changes for 2025

The following major changes are expected in the 2025 Manufacturing Subsidy:

• Significant increase in subsidy cap amount and review of employee size classification:The upper limit for the high value-added products and services category has been expanded to 2,500 million yen, and the global category is now eligible for up to 3,000 million yen. In the case of significant wage increases, this can be increased further, up to a maximum of 4,000 million yen.
• Establishment of special provisions for raising the minimum wage (wage increase supplement):Special measures have been put in place to increase the subsidy rate by up to two-thirds for small and medium-sized enterprises that are working to improve problems and increase wages.
• Elimination of revenue payments (return obligations):The system of returning part or all of the subsidy to the government if a subsidized project turned out to be profitable has been abolished.
• Abolition of the "Custom-made (Labor-saving) Frame":The previous labor-saving and custom-made framework has been abolished. However, a separate system called the "Labor-saving Subsidy (General Type)" continues to exist.
• Clarification of subsidy targets and changes to rules for use in conjunction with other subsidies:The scope of business that is subject to review has been clarified, and it has been clearly stated that "simple process improvements are not eligible." The rules for combined use have also been made more flexible so that combined use (simultaneous application) with other subsidy systems is permitted.

◆ Budget fluctuations and their background

The manufacturing subsidy budget fluctuates depending on the government's economic measures and budgeting policies. Recently, there has been a trend toward expanding the budget in order to achieve policy goals such as responding to rising prices and the weak yen, and promoting wage increases. As the budget increases, more companies have the opportunity to be selected, but it also becomes more important to have a business plan that is in line with the policy goals.

◆Simplified and improved application process

Regarding the application process, improvements may be made to reduce the burden on applicants, such as improving the convenience of the electronic application system, shortening the review period, and expanding the number of pre-application consultation desks.

◆ Application strategies for success

If you approach the manufacturing subsidy with the right strategy, you can greatly increase your chances of being approved.

◆Features of the project that should be emphasized

In your business plan, you can impress the judges by highlighting the following points:

• Innovation: Clearly demonstrate your unique technologies, services, and new business models that no other companies offer.
• Marketability: Be specific about the size and growth potential of your target market, and how you differentiate yourself from your competitors.
• Feasibility: Demonstrate that your implementation plan, funding plan, and timeline are realistic.
• Added value: Quantitatively demonstrate how the implementation of the project will increase added value and total wage payments.

◆Points to remember when preparing application documents

The application documents, especially the business plan, are the most important tools for conveying the appeal of your business to the judges.

• Logical and clear structure: To ensure that anyone can understand the content, write the conclusion first and try to structure it logically.
• Specific numbers: When expressing your goals and plans, use specific numbers such as "increase sales by XX% in XX years" rather than vague expressions such as "aiming to achieve...".
• Use of figures and tables: If there are parts that are difficult to convey through text alone, use diagrams and tables to make them more visually appealing.
• Careful reading of the application guidelines: It is essential to accurately understand the requirements and bonus points for the slot you are applying for and include content that complies with them.

◆Points to learn from success stories

An analysis of past selected projects provides clues to success. Projects that tackle niche markets, utilize local resources, and contribute to solving social issues tend to be highly evaluated.

◆ Expert opinions and advice

If it is difficult for your company to prepare the application documents on your own, it may be effective to seek the help of an expert. By consulting with a small business management consultant or subsidy consultant, you can get advice on how to increase your chances of being approved.

Comparison of manufacturing subsidies with other support systems

There are other subsidy programs besides the Manufacturing Subsidy. It is important to select and combine the most appropriate programs depending on your company's business activities and objectives.

◆Differences from regional subsidies

• Manufacturing Subsidy: The program aims to support small and medium-sized enterprises across the country, and while the scale of support is large, competition is fierce and screening is strict.
• Community Grants: Established by local governments, these funds aim to promote industry and create jobs in the local area. Although the amount of support is small, they often have a high adoption rate and simple procedures.

◆Differences from R&D grants

• Manufacturing Subsidy: We support capital investment to commercialize the results of research and development.
• Research and Development Grants: We support the research and development stage of new technologies and products.

Advantages and disadvantages of each type of support

Effects obtained by combining

These support systems can be used in combination to achieve greater results. For example, by using the R&D subsidy to develop technology and then using the manufacturing subsidy to purchase equipment to commercialize that technology, you can receive consistent support from R&D to commercialization.