General-Type Labor-Saving Subsidy (SME Labor-Saving Investment Subsidy Program)
Core Parameters and Subsidy Standards
The General-Type Labor-Saving Subsidy is a subsidy for labor-saving equipment investment aimed at SMEs, administered directly by the Ministry of Health, Labour and Welfare. According to the latest public-offering guidelines, the core figures are as follows:
| Parameter | Specific value | |------|---------| | Subsidy cap | JPY 10 million per company | | Subsidy rate | 1/2 (for machinery and equipment) up to 2/3 (in other cases) | | Eligible companies | SMEs with 3–300 regular employees | | Add-on measures | If AI or other advanced technology is introduced, an add-on may be applied for (the specific cap is adjusted annually) | | Subsidy-eligible period | Within 12 months from purchase to completion of introduction |
In concrete terms: If your Chinese-owned restaurant chain wants to purchase an automatic cooking machine and an RPA system, and the total investment is JPY 15 million, the general-type subsidy can cover JPY 7.5 million (at the 50% subsidy rate) or more, but no more than JPY 10 million. You would need to self-fund the remaining JPY 7 million.
Suitable Scenarios
The general type is best suited to the following Chinese-owned businesses in Japan:
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Companies with a clear labor-saving investment need but no particular product in mind. You can freely choose any equipment that meets the "productivity improvement" standard, from assembly-line automation equipment to warehouse management systems to kitchen automation machines—a wide range of choices.
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Companies with a larger investment scale (JPY 5 million or more) and moderate funding pressure. Because the subsidy cap runs as high as JPY 10 million, it suits owners with ambitious reform plans.
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Any industry. Whether you are in manufacturing, food processing, construction, or retail, as long as you meet the SME definition (3–300 employees), you can apply.
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Companies able to wait out the review period. The general type has a stricter review, and from application to disbursement of the subsidy usually takes 8–12 months, subject to the reviewing authority's decision.
Advantages
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Large subsidy amount. With a cap of JPY 10 million and a subsidy rate reaching 2/3 (in specific cases), your self-funded portion can be kept as low as JPY 5 million, minimizing pressure for large-scale investment and renovation.
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High freedom of choice. There is no product whitelist restriction. As long as the equipment can be recognized as "productivity-improvement equipment," almost any labor-saving investment can be applied for, giving companies maximum autonomy.
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Flexible add-on mechanism. Equipment that introduces advanced technology such as AI, big-data analytics, or IoT can receive an additional add-on subsidy, potentially raising the subsidy amount to its maximum—attractive to companies wanting to bring in cutting-edge labor-saving solutions.
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Can be combined with other financing. After the general-type subsidy is approved, you can still apply to a bank for financing at the same time; there is no conflict.
Disadvantages and Barriers
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Stricter review standards. The general type uses a rigorous review of "proposal + business plan + various supporting documents," requiring detailed explanations of the investment rationale, expected effects, financial status, and so on. Document preparation takes a long time, and one wrong detail can lead to rejection. A common problem for Chinese-owned businesses is financial statements that are not sufficiently standardized and Japanese-language documentation that is not professional enough.
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Lower approval rate. Based on data over the years, the approval rate for the general-type Labor-Saving Subsidy is about 40–50%, with fierce competition. By contrast, the catalog type's approval rate can reach 70–80% (see the next section).
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Strict introduction deadline. After the subsidy grant decision, you must complete the equipment purchase, installation, and payment within a specified period (usually within 12 months), or the subsidy may be canceled or reduced. For large equipment with long procurement lead times, the time pressure is significant.
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Implementation report required. After the subsidized introduction is complete, you must also submit an introduction-effect report (data proving productivity improvement). If you cannot demonstrate the expected effects, the subsidy may be clawed back, subject to the reviewing authority's decision.
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Complex document requirements. You need to submit multiple formal documents such as interior building drawings, investment quotations, a copy of the corporate tax return, and a business-status report. For Chinese owners unfamiliar with Japanese and the Japanese accounting system, engaging a professional consultant is often necessary, adding extra cost.
Catalog-Type Labor-Saving Subsidy (Labor-Saving Investment Subsidy Program, Catalog Type)
Core Parameters and Subsidy Standards
The Catalog-Type Labor-Saving Subsidy is a "simplified version" of the labor-saving subsidy. The government has prepared in advance a catalog of eligible equipment products, and as long as you choose a product from the catalog, the review is greatly simplified. Core parameters:
| Parameter | Specific value | |------|---------| | Subsidy cap | JPY 5 million per company | | Subsidy rate | 1/2 (fixed) | | Eligible companies | SMEs with 3–300 regular employees | | Review period | Application → grant decision: 3–5 months (50% faster than the general type) | | Subsidy-eligible period | Within 6 months from purchase to completion of introduction | | Target approval rate | 70–80% (subject to the reviewing authority's data) |
In concrete terms: If the automatic cooking machine you want to purchase is in the catalog published by the Ministry of Health, Labour and Welfare and its purchase price is JPY 2 million, the catalog type will directly subsidize JPY 1 million (a fixed 50%), and you self-fund JPY 1 million. From submitting the application to receiving the grant decision usually takes 3–4 months.
Suitable Scenarios
The catalog type is best suited to the following Chinese-owned businesses in Japan:
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Companies with a moderate investment scale (JPY 1 million–5 million) and pressed for time. Because the subsidy cap is only JPY 5 million, it suits cases where a single investment does not exceed this amount; the review is fast, so if your company urgently needs a solution to labor shortages right now, the catalog type can secure subsidy support for introduction more quickly.
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Companies with a specific piece of equipment in mind that is already in the catalog. For example, if you have already settled with a manufacturer on buying a certain RPA software or automation device, and that product has obtained national certification and been listed in the catalog, then the catalog type is a perfect fit.
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Companies with limited document-preparation capacity. If a Chinese-owned business is not well versed in Japan's legal and accounting systems, the catalog type simplifies the review documents, lowers the risk of rejection, and also saves a great deal in consultant fees.
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Companies wanting quick results. From application to disbursement, the catalog type may take only 5–6 months, greatly reducing the time cost compared with the general type's 8–12 months.
Advantages
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A fixed, clear subsidy rate. The subsidy rate is always 50%, with no gray area, so you can precisely calculate your self-funded portion, making financial planning easier.
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Fast review. Because the products have been pre-screened by the government, the review body only needs to confirm your company's eligibility and proof of purchase, so the document review cycle is short. From application submission to the grant-decision notice usually takes 3–5 months—over 50% faster than the general type.
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High approval rate. The catalog type's approval rate has stayed around 70–80% over the years, far above the general type's 40–50%. As long as your company meets the employee-count requirement and the purchase is properly documented, rejection is quite unlikely.
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Simplified documents. Although you still need to submit basic company information, you do not need a detailed investment plan, an effect-forecast table, and the like—only basic proof such as a purchase invoice, a quotation, and company confirmation documents, most of which a Chinese owner can prepare on their own.
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Lighter follow-up burden. After the subsidy is disbursed, the catalog type usually does not require a detailed introduction-effect report, reducing the hassle of later tracking and data submission.
Disadvantages and Barriers
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A low subsidy cap. The JPY 5 million cap is half the general type's JPY 10 million. If your labor-saving investment budget is JPY 7 million or more, the catalog type cannot cover it in full, and you must self-fund a larger amount or apply in phases.
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Restricted product choice. Only products listed in the national catalog can be applied for, which limits your freedom of choice. If a particular brand's equipment you favor is not yet on the list, or if the equipment's functions span multiple categories, you may not be able to use the catalog-type subsidy.
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Lag in catalog updates. The national catalog is usually updated once every six months or once a year, and newly launched innovative equipment may take months to be included. If you want to use the latest technology, the catalog type may not keep up.
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Limited add-on mechanism. Unlike the general type, the catalog type usually has no AI add-on, advanced-technology add-on, or similar mechanism. The subsidy amount is a fixed 50%, and you cannot raise it by adopting more advanced technology.
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A relatively short introduction deadline. Although the total deadline is 6 months—shorter than the general type's 12 months—this can create time pressure for equipment with a long procurement lead time (such as large machinery that must be imported).
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The company-size restriction still applies. The number of regular employees must be between 3 and 300, so startups (fewer than 3) and large companies (over 300) are both excluded.
General Type vs. Catalog Type: A Comparison of Key Metrics
| Comparison dimension | General type | Catalog type | |---------|--------|--------| | Subsidy cap | JPY 10 million | JPY 5 million | | Subsidy rate | 1/2–2/3 (variable) | 1/2 (fixed) | | Review period | 8–12 months | 3–5 months | | Approval rate | 40–50% | 70–80% | | Product choice | Free (no catalog restriction) | Restricted (catalog products only) | | Document complexity | High (detailed documents such as an investment plan) | Low (basic supporting documents) | | Follow-up report | Introduction-effect report required | Usually not required | | Add-on mechanism | Yes (AI, advanced technology, etc.) | None | | Suitable investment amount | JPY 5 million–15 million | JPY 1 million–5 million | | Suitable company profile | Large-scale renovation, strong document capacity, able to bear a long cycle | Moderate investment, urgent need for quick approval, limited document capacity |
How to Choose? Match Your Situation
Scenario 1: A mid-sized restaurant or food-processing company, investment of JPY 3–4 million, urgently needing subsidy funding confirmed within 2–3 months
Recommendation: Catalog type
Reasoning: Your investment is within JPY 5 million, so the catalog type's subsidy cap is sufficient. Automation equipment for restaurants and food processing (such as automatic woks, automatic cutters, and automatic packaging machines) is mostly already in the catalog—just check the national catalog to confirm. The catalog-type review takes only 3–5 months, so if you apply now, you can expect the grant decision around June, after which, once introduction is complete, another 1–2 months and the subsidy arrives—a manageable overall cycle. Compared with the general type's 8–12 months, the time advantage is clear. And with the catalog type's 70–80% approval rate, if your company size and documents are in order, your chances of approval are far higher than with the general type. Self-funding JPY 2 million is an acceptable cost for a mid-sized restaurant.
Scenario 2: A manufacturer planning a JPY 8 million investment to purchase an industrial robot and an MES system, with strong document capacity and willing to wait
Recommendation: General type
Reasoning: Your investment exceeds JPY 5 million, so the catalog type's subsidy cap is not enough. With the general type, at a 1/2 subsidy rate you would receive JPY 4 million and self-fund JPY 4 million; at a 2/3 subsidy rate, you would receive JPY 5.33 million and self-fund JPY 2.67 million—a more economical choice for a manufacturer of some scale. The industrial robot is usually in the catalog, but the MES system (a management system) may not be, or the specific model you want may not meet the catalog standard—which is exactly where the general type's freedom of choice comes into its own. Since your company has strong document capacity, it can prepare a detailed investment plan, productivity-improvement data, and so on, raising the review's approval rate. Although you must wait 8–12 months, the subsidy amount is larger and the ROI is higher—worthwhile for a medium- to long-term corporate overhaul.
Scenario 3: A small retail company, investment of JPY 1.5 million to buy RPA automation software, tight cash flow, unable to wait 12 months
Recommendation: Catalog type
Reasoning: With a JPY 1.5 million investment, the catalog type subsidizes JPY 750,000 and you self-fund JPY 750,000—minimal funding pressure. As an office-automation tool, most mainstream RPA software products are already listed in the catalog (confirmation needed). The key point is that you cannot bear an 8–12 month wait—if you apply for the general type now, the subsidy might not arrive until next year, by which time your cash-flow problem may have worsened. The catalog type can be confirmed in just 3–5 months, with the subsidy in hand around July, greatly easing the cash pressure. And with an approval rate as high as 70–80%, a small company with simple documents actually faces a lower risk of rejection. Self-funding JPY 750,000 is easily acceptable for a small retailer.
Scenario 4: A technology manufacturer with a JPY 12 million investment budget, wanting to introduce an AI visual-inspection system (not yet in the catalog), with a professional planning department
Recommendation: General type
Reasoning: First, cutting-edge technology such as AI visual inspection is not yet on the catalog-type product list; only the general type can accommodate this kind of innovative equipment. Second, the general type's add-on mechanism is designed precisely for advanced technology such as AI—you might receive the 1/2 base subsidy rate plus an AI add-on, raising the total rate to 2/3 or even higher, with the subsidy amount reaching JPY 8 million or more and self-funding kept within JPY 4 million. Although the review cycle is long (8–12 months), as a technology company you have a professional department able to prepare a high-quality investment plan and productivity-improvement data (quantified metrics such as inspection accuracy and output-efficiency gains). This way you can both cover a large investment and maximize the subsidy amount through the advanced-technology add-on.
Frequently Asked Questions (FAQ)
Q1: My company has 280 employees. Can I apply for either of these subsidies?
A: Yes. Both subsidies have the same company-size requirement—between 3 and 300 regular employees. Your company at 280 fully qualifies. "Regular employees" refers to the average monthly number of workers over the past 3 months, including full-time employees, part-time employees, and dispatched workers. Note that this figure must be proven to the subsidy review body through company confirmation documents (such as employment insurance enrollment documents and payroll ledgers) and cannot be reported arbitrarily.
Q2: The product is already in the catalog, but I want to add extra custom features. Can I still use the catalog-type subsidy?
A: This is a common gray area. According to the Ministry of Health, Labour and Welfare's rules, as long as the equipment's core functions and specifications match the catalog version, minor customization (such as interface language or OS configuration) is usually still recognized. But if your customization changes the equipment's essential function or performance parameters, it may no longer meet the catalog standard, and the review body will determine that you must switch to the general type. The recommended approach is: before purchasing, submit a prior consultation directly to the subsidy review body (usually the section in charge of the industrial employment stabilization grant, etc., at the prefectural level), bringing the product specifications and an explanation of your customization needs, to obtain an official answer. This both lowers the risk of rejection and leaves evidence for the later review.
Q3: If the general type is rejected, can I still apply for the catalog type? Or must I wait another year?
A: You can absolutely reapply for the catalog type—no need to wait a year. The two subsidies are independent application channels; as long as you meet the company-size and product conditions, being rejected for one does not affect the other. The recommended strategy is: if you choose the general type, prepare for the catalog type at the same time during the review period (which usually takes 3–4 months for a preliminary result), selecting a backup product from within the catalog. The moment the general type is rejected, you can immediately submit the catalog-type application; in terms of timing, you may only need to wait an extra 1–2 months to receive the catalog-type grant decision. Compared with giving up on the subsidy and self-funding the whole amount, this backup plan's cost is manageable. But note that within the same fiscal year, the total subsidy amount for the same company (regardless of subsidy type) usually has an upper limit, with the specific rules subject to that year's public-offering guidelines.
Q4: Before the subsidy arrives, must I pay for the equipment myself first? Or does the subsidy come to me first so I can then buy it?
A: You must self-fund the purchase first and then wait for the subsidy to arrive. The subsidy flow is: (1) the company purchases the equipment and pays for it → (2) submits the subsidy application and proof of payment → (3) the review body issues a grant decision → (4) the company submits a payment-completion report → (5) the subsidy arrives. From purchase to the subsidy landing in your account, the general type usually takes 12–16 months and the catalog type 6–10 months. For companies with tight cash flow, this is significant pressure. Coping recommendations: (1) apply to a bank for a "financing + subsidy in parallel" plan—borrow from the bank to purchase first, then repay the loan with the subsidy once it arrives, keeping interest manageable; (2) negotiate installment payments with the supplier, keeping the down payment low and paying the rest in installments, settling up when the subsidy arrives. This can substantially ease the cash-flow burden.
Q5: My company is in Tokyo. Is the subsidy uniform nationwide? Or does it differ by prefecture?
A: The subsidy's basic standards and caps are uniform nationwide, set by the Ministry of Health, Labour and Welfare. However, the review body, acceptance timing, and add-on measures may differ slightly by prefecture. For example, Tokyo may add a prefectural-level subsidy layer on top of the base subsidy (though this depends on the year and program), or some prefectures set an additional "regional industry promotion add-on." We recommend first checking the Ministry of Health, Labour and Welfare's official Labor-Saving Investment Subsidy Program website, then contacting your prefecture's Industry and Labor Division or Hello Work (employment service center) to confirm whether there is an additional prefecture-specific subsidy program. Chinese business owners often overlook this; in fact, a local add-on can sometimes bring an extra JPY 200,000–300,000, so do not miss it.
Q6: During the review period, my business is struggling and I have unpaid taxes or social insurance. Will this affect subsidy approval?
A: There is a significant risk. The subsidy review body will examine the following documents from your company: (1) copies of corporate tax returns for the past 3 years; (2) payroll payment details for the most recent 3 months (proof of social insurance deductions); (3) employment insurance enrollment and payment status. Any tax arrears or unpaid social insurance will be regarded as "deterioration of business status" or "labor-law violation," directly affecting your credit score. The general type's approval rate will drop sharply, and while the catalog type's simplified review is somewhat less strict, it cannot fully avoid this issue either. Coping recommendations: before submitting the subsidy application, ensure that taxes and social insurance are fully compliant for at least the preceding 6 months. If arrears already exist, pay them off immediately and obtain a "certificate of full payment." Although this back-payment increases costs, compared with securing a subsidy of several million yen, it is a worthwhile investment. We also recommend consulting a Zeirishi (tax accountant) to ensure your financial statements are compliant.
Final Advice
There is no absolute "correct answer" as to whether to choose the general type or the catalog type—it comes down to balancing "subsidy amount" against "application difficulty/cycle."
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If your priority is: quick approval, lower risk, a lighter document burden → choose the catalog type. For an investment within JPY 5 million, tight cash flow, and an urgent need to see results in 2–4 months, the catalog type is the smart move.
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If your priority is: maximizing the subsidy amount, freedom of product choice, and being willing to invest a professional team → choose the general type. For an investment over JPY 5 million, wanting to introduce cutting-edge technology, and a company with a professional planning/finance department, the general type offers greater return potential.
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If both fit → consider applying in phases: use the catalog type first to quickly launch a small-scale renovation (around JPY 3 million); once the subsidy is in hand, use part of the proceeds to support a second, general-type large-scale renovation (JPY 8 million or more). This way you both see quick results and maximize the total subsidy amount (but watch the single-year total subsidy cap).
Before formally submitting, we strongly recommend a free prior consultation. Submit your company's basic information and investment plan to your local Hello Work, Industry and Labor Division, or a subsidy consulting firm, and they will assess your application prospects, recommend a choice, and point out common mistakes—free of charge. Spending 2–3 hours on this step can save you weeks of rework and hundreds of thousands of yen in consulting fees, an extremely high return on investment.
Whichever you choose, remember that the final approval and amount of the subsidy depend on the reviewing authority's decision—no consulting firm can guarantee approval. But through a sensible choice and professional preparation, it is entirely possible to substantially raise your chances of approval.
If you have further questions about the subsidy application process, determining company eligibility, or whether a product qualifies, feel free to consult a professional subsidy consulting firm—most initial consultations are free and will tailor an application plan to your situation. We wish your labor-saving investment a smooth journey!