Those public corporations and nonprofit foundations which make remarkable contributions to the promotion of public welfare are authorized to be designated as nonprofit foundations and to benefit from the following favorable tax policy. In the case of a corporation that makes a donation to such a foundation, the amount donated is recognized as a financial loss for tax purposes up to a certain limit equivalent to that of a general financial loss. If the donor is an individual, the amount donated can be deducted from the individual's total taxable income. Designated nonprofit foundations in the area of culture include the Japan Arts Council as well as foundations in the fields of music, art, drama, cultural property protection and those which support cultural activities. As of July 1993, there are 38 designated nonprofit foundations under the jurisdiction of the Agency for Cultural Affairs.
