{"id":4696,"date":"2026-07-09T16:20:53","date_gmt":"2026-07-09T07:20:53","guid":{"rendered":"https:\/\/smilesoftware.org\/?p=4696"},"modified":"2026-07-09T16:20:53","modified_gmt":"2026-07-09T07:20:53","slug":"gx%e6%8e%a8%e9%80%b2%e6%b3%95%e3%81%a8%e3%81%af%ef%bc%9f%e8%84%b1%e7%82%ad%e7%b4%a0%e3%81%a8%e7%b5%8c%e6%b8%88%e6%88%90%e9%95%b7%e3%80%81%e3%82%a8%e3%83%8d%e3%83%ab%e3%82%ae%e3%83%bc%e3%81%ae%e5%ae%89","status":"publish","type":"post","link":"https:\/\/smilesoftware.org\/en\/gx%E6%8E%A8%E9%80%B2%E6%B3%95%E3%81%A8%E3%81%AF%E8%84%B1%E7%82%AD%E7%B4%A0%E3%81%A8%E7%B5%8C%E6%B8%88%E6%88%90%E9%95%B7%E3%82%A8%E3%83%8D%E3%83%AB%E3%82%AE%E3%83%BC%E3%81%AE%E5%AE%89\/","title":{"rendered":"What Is the GX Promotion Act? A Law Aimed at Decarbonization, Economic Growth, and a Stable Energy Supply"},"content":{"rendered":"<div class=\"wp-block-group smile-post-content\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\"><header class=\"smile-article-header\"><div><span class=\"smile-category-pill\">Blog<\/span><span class=\"smile-date\">2026.07.01<\/span><\/div><h1 class=\"smile-article-title\">What Is the GX Promotion Act? A Law Aimed at Decarbonization, Economic Growth, and a Stable Energy Supply<\/h1><p class=\"smile-excerpt\">The GX Promotion Act is a law designed to advance both decarbonization and economic growth. Decarbonization and carbon neutrality are often seen as being at odds with economic growth, but the Japanese government is promoting GX (Green Transformation) across domestic companies and society as a whole, with the goal of achieving a smooth transition to a decarbonized, growth-oriented economic structure.<br>\nIn this article, we explain the overview, benefits, challenges, and future outlook of the GX Promotion Act being advanced by the Japanese government.<\/p><\/header>\n\n<nav class=\"smile-toc\" aria-label=\"Table of Contents\"><h2 class=\"smile-toc__title\">Table of Contents<\/h2><div class=\"smile-toc__grid\"><a class=\"smile-toc__item\" href=\"#section-1\"><b class=\"smile-toc__number\">01<\/b><span class=\"smile-toc__label\">What Is the GX Promotion Act?<\/span><\/a><a class=\"smile-toc__item\" href=\"#section-2\"><b class=\"smile-toc__number\">02<\/b><span class=\"smile-toc__label\">About the GX Promotion Act (Act on Promoting a Smooth Transition to a Decarbonized Growth-Oriented Economic Structure)<\/span><\/a><a class=\"smile-toc__item\" href=\"#section-3\"><b class=\"smile-toc__number\">03<\/b><span class=\"smile-toc__label\">About the Amended GX Promotion Act<\/span><\/a><a class=\"smile-toc__item\" href=\"#section-4\"><b class=\"smile-toc__number\">04<\/b><span class=\"smile-toc__label\">Key Points to Note About the GX Promotion Act<\/span><\/a><a class=\"smile-toc__item\" href=\"#section-5\"><b class=\"smile-toc__number\">05<\/b><span class=\"smile-toc__label\">Summary: The GX Promotion Act<\/span><\/a><\/div><\/nav>\n\n\n<div id=\"section-1\" class=\"wp-block-group smile-section\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\"><div class=\"smile-section__head\"><div class=\"smile-section__number\">01<\/div><h2 class=\"smile-section__title\">What Is the GX Promotion Act?<\/h2><\/div>\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image10.png\" alt=\"GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f\u8131\u70ad\u7d20\u3068\u7d4c\u6e08\u6210\u9577\u3001\u30a8\u30cd\u30eb\u30ae\u30fc\u306e\u5b89\u5b9a\u4f9b\u7d66\u3092\u76ee\u6307\u3059\u6cd5\u5f8b\" class=\"wp-image-4694\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image10.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image10-300x169.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image10-768x432.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image10-18x10.png 18w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>The GX Promotion Act refers to the Act on Promoting a Smooth Transition to a Decarbonized Growth-Oriented Economic Structure, enacted in fiscal 2023. It was established to achieve both carbon neutrality by 2050 and continued economic growth. Over the 10 years from fiscal 2023, the act aims to encourage more than 150 trillion yen in combined public- and private-sector GX investment, strengthen Japan\u2019s economic growth and industrial competitiveness, reduce CO2 emissions as a climate change measure, and ensure a stable energy supply that does not depend on fossil fuels.<\/p>\n\n\n\n\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en-1024x576.png\" alt=\"\" class=\"wp-image-4879\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en-1024x576.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en-300x169.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en-768x432.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en-1536x864.png 1536w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en-18x10.png 18w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f_section-1_en.png 1672w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center\">(Source: Ministry of Economy, Trade and Industry, \"GX (Green Transformation)\")<\/p>\n\n\n\n<p>In addition, based on the \u201cGX2040 Vision\u201d approved by the Cabinet in February 2026, efforts are also underway to give concrete form to the \u201cgrowth-oriented carbon pricing concept\u201d in conjunction with the GX Promotion Act.<\/p>\n\n\n\n\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"683\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en-1024x683.png\" alt=\"\" class=\"wp-image-4886\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en-1024x683.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en-300x200.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en-768x512.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en-18x12.png 18w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en-930x620.png 930w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/\u6210\u9577\u5fd7\u5411\u578b\u30ab\u30fc\u30dc\u30f3\u30d7\u30e9\u30a4\u30b7\u30f3\u30b0\u69cb\u60f3_en.png 1536w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p class=\"has-text-align-center\">(Source: Ministry of Economy, Trade and Industry, \"GX (Green Transformation)\")<\/p>\n\n\n\n<p>First, Japan will issue GX Economic Transition Bonds totaling approximately 20 trillion yen to encourage private-sector GX investment. It will also introduce carbon pricing in stages, including emissions trading and fossil fuel levies, creating a system in which companies that act early on GX face a lighter burden in the future. In addition, by promoting transition finance, including the issuance of GX Economic Transition Bonds, Japan aims to stimulate the use of renewable energy and the development of technologies such as EVs (electric vehicles), with the goal of realizing more than 150 trillion yen in GX investment over 10 years.<\/p>\n\n\n\n<p>The GX Promotion Act is a legal framework designed to shift the fossil fuel\u2013centered economy, society, and industrial structure that have existed since the Industrial Revolution toward clean energy, transform the entire socioeconomic system, and achieve stable energy supply, economic growth, and emissions reductions at the same time.<\/p>\n\n\n\n<h3 class=\"wp-block-heading smile-subheading\">What Is GX (Green Transformation)?<\/h3>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"724\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image7.png\" alt=\"GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f\u8131\u70ad\u7d20\u3068\u7d4c\u6e08\u6210\u9577\u3001\u30a8\u30cd\u30eb\u30ae\u30fc\u306e\u5b89\u5b9a\u4f9b\u7d66\u3092\u76ee\u6307\u3059\u6cd5\u5f8b\" class=\"wp-image-4691\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image7.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image7-300x212.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image7-768x543.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image7-18x12.png 18w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>GX (Green Transformation) means moving away from dependence on fossil energy and transitioning to a social structure that makes use of clean energy. However, because decarbonization alone can hinder economic growth, the key is to maintain sustainable economic growth while making this transition.<\/p>\n\n\n\n<p>Today's industries and societies remain heavily dependent on fossil fuels such as coal and oil, which emit greenhouse gases. As a result, global warming has accelerated at an unprecedented pace since the Industrial Revolution.<\/p>\n\n\n\n<p>To halt global warming, it is essential to reduce greenhouse gas emissions by using renewable energy, such as power generated from solar, wind, and hydropower, and by building supply chains that consume less energy. At the same time, energy policy must not slow economic and social activity. It is also necessary to foster new growth sectors, promote innovation, and transition to a sustainable social structure.<\/p>\n\n\n\n<p>Advanced economies in Europe and North America are actively expanding the use of clean energy and developing decarbonization technologies. These efforts are not only helping them move away from fossil fuels, but also driving a shift toward new, sustainable social structures. GX initiatives offer benefits beyond supporting domestic industry and economic growth; they can also help secure a stable energy supply and reduce geopolitical risks.<\/p>\n\n\n\n<h3 class=\"wp-block-heading smile-subheading\">Why Is GX Necessary?<\/h3>\n\n\n<div class=\"smile-summary-flow\"><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">01<\/span><p class=\"smile-summary-flow__body\">This is because the Paris Agreement, adopted at the international conference COP21 (the 21st Conference of the Parties to the United Nations Framework Convention on Climate Change) in 2015, required all member countries to set greenhouse gas emissions reduction targets as part of global warming countermeasures. Under the Paris Agreement, all parties are obligated to submit and update their greenhouse gas emissions reduction targets every five years as Nationally Determined Contributions (NDCs). The agreement also sets long-term goals, including holding the increase in the global average temperature to well below 2\u00b0C above pre-industrial levels while pursuing efforts to limit it to 1.5\u00b0C, and reaching a global peak in greenhouse gas emissions as soon as possible, followed by a balance between emissions and removals, such as absorption by forests, in the second half of the 21st century. Japan\u2019s medium-term target is to reduce greenhouse gas emissions in FY2030 by 46% compared with FY2013 levels, while continuing efforts toward a 50% reduction. Japan has also set targets to reduce emissions by 60% in FY2035 and by 73% in FY2040, both compared with FY2013 levels. In 2020, the Japanese government announced a policy to achieve carbon neutrality by 2050, meaning that greenhouse gas emissions and greenhouse gas absorption or removal would effectively balance out to net zero. Japan also chaired COP3, the third Conference of the Parties to the United Nations Framework Convention on Climate Change, in 1997, where the Kyoto Protocol was adopted and went on to have a major impact on subsequent global warming countermeasures. For these reasons, Japan\u2019s efforts to realize GX are attracting attention around the world. What happens if GX is not pursued?<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">02<\/span><p class=\"smile-summary-flow__body\">If GX (green transformation) does not move forward, global warming, which is already underway, will accelerate. This would lead to more extreme weather events and disasters, threatening people\u2019s lives and safety. Continued reliance on imported fossil fuels such as oil and natural gas would also leave Japan exposed to risks such as price surges and supply instability. If energy supplies from overseas were disrupted, not only Japan\u2019s economic activity but also people\u2019s daily lives could fall into a critical situation.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">03<\/span><p class=\"smile-summary-flow__body\">The push to reduce greenhouse gas emissions and achieve carbon neutrality has become a global trend. If Japan cannot realize GX at an early stage, its products and services may become harder to export, potentially leaving the country isolated from the global economy.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">04<\/span><p class=\"smile-summary-flow__body\">On the other hand, if Japan can position itself to take a leading role in advancing GX globally, it can contribute not only to its own economic growth but also to the development of the global economy. This is because preventing global warming through the use of renewable energy and the development of advanced technologies for decarbonization has become a challenge that countries around the world must address.<\/p><\/article><\/div><\/div><\/div>\n\n\n\n<div id=\"section-2\" class=\"wp-block-group smile-section\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\"><div class=\"smile-section__head\"><div class=\"smile-section__number\">02<\/div><h2 class=\"smile-section__title\">About the GX Promotion Act (Act on Promoting a Smooth Transition to a Decarbonized Growth-Oriented Economic Structure)<\/h2><\/div>\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image4.png\" alt=\"GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f\u8131\u70ad\u7d20\u3068\u7d4c\u6e08\u6210\u9577\u3001\u30a8\u30cd\u30eb\u30ae\u30fc\u306e\u5b89\u5b9a\u4f9b\u7d66\u3092\u76ee\u6307\u3059\u6cd5\u5f8b\" class=\"wp-image-4688\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image4.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image4-300x169.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image4-768x432.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image4-18x10.png 18w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>To promote more than 150 trillion yen in public- and private-sector GX investment over the 10 years from FY2023 and enable a smooth transition to a decarbonized, growth-oriented economic structure, the following five main measures will be implemented.<\/p>\n\n\n\n<p>1. Develop and Implement a GX Strategy<br>2. Issuance of GX Economic Transition Bonds<br>3. Introduction of Growth-Oriented Carbon Pricing <br>4. Establishment of the GX Promotion Agency <br>5. Evaluation of GX Investment Progress and Necessary Reviews<\/p>\n\n\n<div class=\"smile-summary-flow\"><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">01<\/span><p class=\"smile-summary-flow__body\">Develop and Implement a GX Strategy<br>\nFirst, the Japanese government formulates a comprehensive and strategic roadmap to promote GX, known as the Strategy for Promoting the Transition to a Decarbonized Growth-Oriented Economic Structure. This strategy is regularly reviewed and updated based on the progress of the transition to a GX economy, ensuring that it remains aligned with changing circumstances and policy objectives.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">02<\/span><p class=\"smile-summary-flow__body\">Issuance of GX Economic Transition Bonds<br>\nTo support the upfront investments required to achieve the GX Strategy, the Japanese government will issue approximately JPY 20 trillion in GX Economic Transition Bonds (Decarbonized Growth-Oriented Economic Structure Transition Bonds) over a 10-year period starting in fiscal year 2023.<br>\nThe purpose of GX Economic Transition Bonds is to support innovative technology development and capital investment that contribute to decarbonizing energy and raw materials while improving business productivity and profitability.<br>\nThe repayment of GX Economic Transition Bonds will be completed by fiscal year 2050 using revenue generated through the Growth-Oriented Carbon Pricing mechanism, including fossil fuel surcharges and contributions from designated businesses.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">03<\/span><p class=\"smile-summary-flow__body\">Introduction of Growth-Oriented Carbon Pricing<br>\nGrowth-Oriented Carbon Pricing is a mechanism that assigns a price to carbon emissions to enhance the value of GX-related products and business activities. Combined with upfront investment support, it provides incentives for businesses that take the lead in advancing Green Transformation (GX) initiatives.<br>\n\u2460 Carbon Levy (Fossil Fuel Levy)<br>\nFrom FY2028, a fossil fuel levy will be collected from fossil fuel importers and other businesses based on the amount of CO2 derived from fossil fuels. By imposing this levy on importers and others, the policy aims to reduce energy transactions associated with CO2 emissions and encourage a shift to renewable energy.<br>\n\u2461 Emissions Trading System (ETS)<br>\nFrom FY2033, CO2 emissions allowances will be allocated to power generation companies, with some allowances provided for a fee. If a company exceeds its cap, a contribution will be collected from the specified business operator. The specific allocation and unit price of paid emissions allowances are expected to be determined through a bidding process, or paid auction.<br>\nGrowth-Oriented Carbon Pricing will not be introduced immediately. Instead, a transition period will be provided to allow businesses to implement GX initiatives while gradually reducing overall energy costs over the medium and long term. The pricing mechanism will start at a relatively low level and be increased progressively over time.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">04<\/span><p class=\"smile-summary-flow__body\">Establishment of the GX Promotion Agency<br>\nA GX Promotion Agency (Organization for Promoting the Transition to a Decarbonized Growth-Oriented Economic Structure) will be established with the approval of the Minister of Economy, Trade and Industry (METI). The agency will support private-sector GX investments, collect fossil fuel levies and contributions from designated businesses, and administer the Emissions Trading System (ETS).<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">05<\/span><p class=\"smile-summary-flow__body\">Evaluation of GX Investment Progress and Necessary Reviews<br>\nBased on the progress of GX investments and domestic and international economic trends related to CO\u2082 emissions, the Japanese government will periodically review and revise its GX policies as necessary. It will also consider specific measures for the full implementation of the Fossil Fuel Levy and the Emissions Trading System (ETS), while introducing the necessary legal framework within two years after the law comes into effect.<br>\nThe measures outlined above represent the key provisions of the GX Promotion Act as of fiscal year 2023. However, on May 28, 2025, the Act was partially revised. In the following section, we will take a closer look at the key updates introduced in the amended GX Promotion Act.<\/p><\/article><\/div><\/div><\/div>\n\n\n\n<div id=\"section-3\" class=\"wp-block-group smile-section\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\"><div class=\"smile-section__head\"><div class=\"smile-section__number\">03<\/div><h2 class=\"smile-section__title\">About the Amended GX Promotion Act<\/h2><\/div>\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"576\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image9.png\" alt=\"GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f\u8131\u70ad\u7d20\u3068\u7d4c\u6e08\u6210\u9577\u3001\u30a8\u30cd\u30eb\u30ae\u30fc\u306e\u5b89\u5b9a\u4f9b\u7d66\u3092\u76ee\u6307\u3059\u6cd5\u5f8b\" class=\"wp-image-4693\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image9.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image9-300x169.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image9-768x432.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image9-18x10.png 18w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>On May 28, 2025, a partial amendment to the Act on Promotion of a Smooth Transition to a Decarbonized Growth-Oriented Economic Structure was approved and enacted at a plenary session of the House of Councillors. From April 1, 2026, the following four main measures are scheduled to be implemented.<\/p>\n\n\n\n<ul class=\"wp-block-list smile-bullet-list\">\n<li>Emissions Trading System<\/li>\n\n\n\n<li>Strengthening Resource Circulation<\/li>\n\n\n\n<li>Collection of the Fossil Fuel Levy<\/li>\n\n\n\n<li>Financial Support for the GX Sector<\/li>\n<\/ul>\n\n\n\n<p>The following sections explain each measure. Emissions trading system: Businesses with direct CO2 emissions above a certain threshold of 100,000 tons will be required to participate, and the collection of specified business operator contributions based on the emissions trading system will begin in fiscal 2033. Businesses in the transition phase will receive free emissions allowances, but those whose actual emissions exceed their allocated allowances will need to procure additional allowances. Businesses that make progress in reducing emissions and generate a surplus will be able to sell or carry over their allowances on the emissions allowance trading market operated by the GX Promotion Organization. Additional measures will also be introduced to stabilize allowance prices, including upper and lower price limits. If prices rise sharply, businesses may be deemed to have surrendered allowances by paying a fixed price; if prices fall too low, the GX Promotion Organization may support the market by purchasing allowances. Covered businesses will also be required to prepare and submit plans that set out medium- to long-term emissions reduction targets and the initiatives they will take to achieve them. Strengthening resource circulation: Measures will include mandating the use of recycled resources, promoting environmentally conscious design, and encouraging the recycling of raw materials and other inputs needed for GX. CE commerce, or circular economy commerce, will also be promoted. New categories will be established for CE commerce businesses such as sharing services, and standards will be set for these businesses from the perspective of effective resource use and related objectives. Through these measures, Japan will strengthen the realization of a circular economy by promoting the use of recycled materials for decarbonization, making effective use of limited resources, and advancing resource recovery and recycling. Collection of fossil fuel levies<\/p>\n\n\n\n<p>The legislation establishes technical provisions needed to administer the fossil fuel levy, including payment deadlines and delinquency procedures for fossil fuel importers, as well as reductions and exemptions for fuels not used domestically. The fossil fuel levy is scheduled to begin in fiscal 2028. Financial support for the GX sector will be provided through proceeds from the issuance of GX Economy Transition Bonds, which will be used to compensate the general account for revenue shortfalls resulting from tax credits under the strategic tax system for goods related to the GX sector. The revised GX Promotion Act was adopted to strengthen incentives for companies to pursue GX and to encourage broader motivation for GX initiatives. By having the GX Promotion Organization supplement risks that private companies cannot fully absorb, the act is expected to accelerate the financial support needed to promote GX, active investment in the GX sector, emissions trading, and the strengthening of industrial competitiveness.<\/p>\n<\/div><\/div>\n\n\n\n<div id=\"section-4\" class=\"wp-block-group smile-section\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\"><div class=\"smile-section__head\"><div class=\"smile-section__number\">04<\/div><h2 class=\"smile-section__title\">Key Points to Note About the GX Promotion Act<\/h2><\/div>\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"683\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image1.png\" alt=\"GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f\u8131\u70ad\u7d20\u3068\u7d4c\u6e08\u6210\u9577\u3001\u30a8\u30cd\u30eb\u30ae\u30fc\u306e\u5b89\u5b9a\u4f9b\u7d66\u3092\u76ee\u6307\u3059\u6cd5\u5f8b\" class=\"wp-image-4685\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image1.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image1-300x200.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image1-768x512.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image1-18x12.png 18w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image1-930x620.png 930w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n<div class=\"smile-summary-flow\"><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">01<\/span><p class=\"smile-summary-flow__body\">Under the amended GX Promotion Act, participation is mandatory for businesses with direct CO2 emissions at or above a certain threshold of 100,000 tons. As a result, businesses with direct CO2 emissions of 100,000 tons or less are not subject to the specified business operator contribution. In addition, the fossil fuel levy is not collected unless the business imports fossil fuels.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">02<\/span><p class=\"smile-summary-flow__body\">However, even businesses that are not currently subject to these requirements may find it difficult to remain unaffected by the growing momentum of GX in the future. If a company is part of the supply chain of organizations with direct CO\u2082 emissions of 100,000 tons or more, it may be asked by its major business partners to support carbon reduction initiatives, adopt renewable energy, or promote the recycling and reuse of raw materials.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">03<\/span><p class=\"smile-summary-flow__body\">Even companies that are not part of a large corporation\u2019s supply chain may be significantly affected, as markets and customers show growing interest in GX. Depending on how they approach GX initiatives, the evaluation and sales of their products and services could change substantially.<\/p><\/article><article class=\"smile-summary-flow__item\"><span class=\"smile-summary-flow__index\">04<\/span><p class=\"smile-summary-flow__body\">By moving quickly on GX, companies can communicate a progressive image and message to the market and their customers, while also creating the potential for sustainable growth over the medium to long term. It is important to stay informed about GX initiatives by governments and major corporations, and to advance the GX measures your company can take ahead of competitors.<\/p><\/article><\/div><\/div><\/div>\n\n\n\n<div id=\"section-5\" class=\"wp-block-group smile-section\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\"><div class=\"smile-section__head\"><div class=\"smile-section__number\">05<\/div><h2 class=\"smile-section__title\">Summary: The GX Promotion Act<\/h2><\/div>\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"684\" src=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image6.png\" alt=\"GX\u63a8\u9032\u6cd5\u3068\u306f\uff1f\u8131\u70ad\u7d20\u3068\u7d4c\u6e08\u6210\u9577\u3001\u30a8\u30cd\u30eb\u30ae\u30fc\u306e\u5b89\u5b9a\u4f9b\u7d66\u3092\u76ee\u6307\u3059\u6cd5\u5f8b\" class=\"wp-image-4690\" srcset=\"https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image6.png 1024w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image6-300x200.png 300w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image6-768x513.png 768w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image6-18x12.png 18w, https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/image6-930x620.png 930w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>The GX Promotion Act, enacted in 2023, is a law designed to achieve carbon neutrality by 2050. Over the 10 years from 2023, it aims to encourage more than 150 trillion yen in combined public- and private-sector GX investment and pursue both decarbonization and economic growth. Following the 2025 amendment, a fossil fuel levy is scheduled to be introduced from fiscal 2028, and the emissions trading system is expected to become fully operational from fiscal 2033. The GX Promotion Act may significantly affect not only companies with annual CO2 emissions of 100,000 tons or more and fossil fuel importers, but also many other businesses. It will become increasingly important for companies to implement the GX initiatives available to them as early as possible and build a track record of action and results ahead of their competitors.<\/p>\n<\/div><\/div>\n\n\n<section class=\"smile-article-cta\"><div class=\"smile-article-cta__label\">SMILE Support<\/div><h2>Start a Consultation on Advancing GX and DX<\/h2><p>We work with you to design an approach tailored to your company\u2019s situation, from assessing the current state to implementing systems and improving operations.<\/p><ul class=\"smile-list\"><li>You can clarify current operational and data-related challenges.<\/li><li>You can design implementation steps that fit your company's structure.<\/li><li>You can also build a framework that remains easy to operate after implementation.<\/li><li>You can start exploring AI and IoT applications in the areas where they are most needed.<\/li><\/ul><a class=\"smile-article-cta__button\" href=\"\/en\/contact\/\">Contact Us<\/a><\/section><\/div><\/div>","protected":false},"excerpt":{"rendered":"<p>The GX Promotion Act is a law enacted in fiscal year 2023 to promote...&nbsp;<a href=\"https:\/\/smilesoftware.org\/en\/gx%E6%8E%A8%E9%80%B2%E6%B3%95%E3%81%A8%E3%81%AF%E8%84%B1%E7%82%AD%E7%B4%A0%E3%81%A8%E7%B5%8C%E6%B8%88%E6%88%90%E9%95%B7%E3%82%A8%E3%83%8D%E3%83%AB%E3%82%AE%E3%83%BC%E3%81%AE%E5%AE%89\/\" class=\"\" rel=\"bookmark\">Read More &raquo;<span class=\"screen-reader-text\">What Is the GX Promotion Act? A Law Aimed at Decarbonization, Economic Growth, and a Stable Energy Supply<\/span><\/a><\/p>","protected":false},"author":2,"featured_media":4684,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"neve_meta_sidebar":"","neve_meta_container":"","neve_meta_enable_content_width":"","neve_meta_content_width":0,"neve_meta_title_alignment":"","neve_meta_author_avatar":"","neve_post_elements_order":"","neve_meta_disable_header":"","neve_meta_disable_footer":"","neve_meta_disable_title":"","_price":"","_stock":"","_tribe_ticket_header":"","_tribe_default_ticket_provider":"","_ticket_start_date":"","_ticket_end_date":"","_tribe_ticket_show_description":"","_tribe_ticket_show_not_going":false,"_tribe_ticket_use_global_stock":"","_tribe_ticket_global_stock_level":"","_global_stock_mode":"","_global_stock_cap":"","_tribe_rsvp_for_event":"","_tribe_ticket_going_count":"","_tribe_ticket_not_going_count":"","_tribe_tickets_list":"[]","_tribe_ticket_has_attendee_info_fields":false,"_themeisle_gutenberg_block_has_review":false,"_ti_tpc_template_sync":false,"_ti_tpc_template_id":"","footnotes":""},"categories":[32],"tags":[],"class_list":["post-4696","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"rttpg_featured_image_url":{"full":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen.png",1672,941,false],"landscape":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen.png",1672,941,false],"portraits":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen.png",1672,941,false],"thumbnail":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen-150x150.png",150,150,true],"medium":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen-300x169.png",300,169,true],"large":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen-1024x576.png",1024,576,true],"1536x1536":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen-1536x864.png",1536,864,true],"2048x2048":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen.png",1672,941,false],"trp-custom-language-flag":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen-18x10.png",18,10,true],"neve-blog":["https:\/\/smilesoftware.org\/wp-content\/uploads\/2026\/07\/redmine-1361-featured-imagegen-930x620.png",930,620,true]},"rttpg_author":{"display_name":"\u7b20\u539f \u840c","author_link":"https:\/\/smilesoftware.org\/en\/author\/chinh-man\/"},"rttpg_comment":0,"rttpg_category":"<a href=\"https:\/\/smilesoftware.org\/en\/category\/blog\/\" rel=\"category tag\">\u30d6\u30ed\u30b0<\/a>","rttpg_excerpt":"GX\u63a8\u9032\u6cd5\u3068\u306f\u30012023\u5e74\u5ea6\u306b\u6210\u7acb\u3057\u305f\u300c\u8131\u70ad\u7d20\u6210\u9577\u578b\u7d4c\u6e08\u69cb\u9020&hellip;&nbsp;Read More &&hellip;","_links":{"self":[{"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/posts\/4696","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/comments?post=4696"}],"version-history":[{"count":14,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/posts\/4696\/revisions"}],"predecessor-version":[{"id":4887,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/posts\/4696\/revisions\/4887"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/media\/4684"}],"wp:attachment":[{"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/media?parent=4696"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/categories?post=4696"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/smilesoftware.org\/en\/wp-json\/wp\/v2\/tags?post=4696"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}