（5）The 1940 Law concerning the National Treasury's Share of Compulsory Education Expenses

In 1940 the local funding system was thoroughly revised as were put in force on April 1, 1940, the new tax laws and the accompanying 1940 Law concerning the National Treasury's Share of Compulsory Education Expenses, which were promulgated on March 29 of that year. As a result of thus overall reorganization the system of provisional local funding was replaced by a permanent system for distributing national tax revenues to local public bodies.

The amendment in the financial system of compulsory education was substantially forwarded with the enforcement of the above-mentioned Law in coordination with the Order concerning the Prefectural Burden for City, Town, and Village Elementary School Teachers' Regular Salaries and Traveling Expenses to Their New Posts, which was promulgated on March 29, 1940, and put in force on April 1 of that year. By virtue of this Order, the responsibility to pay city, town, and village elementary school teachers' regular salaries and traveling expenses to their new posts came to be imposed on the prefectural authorities and by virtue of the above-mentioned Law, one half of the amount paid by prefectures to city, town, and village ordinary elementary school teachers as regular salaries was to come from the National Treasury.

The transfer of the responsibility for the payment of elementary school teachers' salaries from cities, towns, and villages, whose financial capacity was often limited, to prefectures, which had a more flexible and larger financial capacity, stabilized the financial situation of the schools as well as facilitated a nationwide standardization of salaries. Furthermore the change from a fixed national subsidy for compulsory education expenses to a cost-sharing system of these expenses was an epochmaking reform, in that the national and prefectural share of financing city, town, and village ordinary elementary school teachers' salaries became thus clarified. The remaining half borne by prefectures was taken care of by the distribution of national tax revenues to the prefectural authorities.

The Order concerning the Prefectural Burden for National School Teachers' Regular Salaries and Allowances was promulgated on March 7, 1943, and put in force on April 1 of that year wholly revising the above-mentioned Order concerning the Prefectural Burden for City, Town, and Village Elementary School Teachers' Regular Salaries and Traveling Expenses to Their New Posts. The new Order imposed on the prefectures the responsibility to pay National School teachers' long service increments, special increments, bonuses, death grants, traveling expenses other than those to their new posts, provisional family allowances, provisional allowances, and wartime service allowances in addition to regular salaries and traveling expenses to their new posts already to be paid. A revision of the 1940 Law concerning the National Treasury's Share of Compulsory Education Expenses was promulgated on March 8, 1943, and put in force on April 1 of that year. This revision expanded the National Treasury's share to pay one half of National School teachers' long service increments, special increments, bonuses, death grants, and traveling expenses to their new posts in addition to regular salaries already to be paid.

Since the foundation of the youth school system in April, 1935, city, town, and village youth school teachers' long service increments were subsidized from the National Treasury. As stated already, attendance at youth school was made compulsory for boys in April, 1939, and on the other hand, the Law for Subsidizing Youth School Expenses from the National Treasury was promulgated on March 24, 1939, and put in force on April 1 of that year introducing a fixed subsidy for city, town, and village youth school teachers' regular salaries and allowances from the National Treasury. On April l, 1944, with the enforcement of a revision of the Order concerning the Prefectural Burden for National School Teachers' Regular Salaries and Allowances, which was promulgated on February 17, 1944, the responsibility for the payment of city, town, and village youth school teachers' regular salaries, long service increments, special increments, bonuses, death grants, traveling expenses, provisional family allowances, provisional allowances and wartime service allowances was transferred from cities towns, and villages to prefectures. At the same time, a revision of the Law for Subsidizing Youth School Expenses from the National Treasury, which was promulgated on February 17, 1944, also came into force on April 1 of that year establishing a cost-sharing system with the national and prefectural governments paying respectively one half of city, town, and village youth school teachers' regular salaries, long service increments, bonuses, death grants, and traveling expenses to their new posts.