Over the past two decades, Japan’s per capita alcohol consumption has plunged by more than a quarter. Once a staple of workplace bonding and a steady stream of government revenue, alcohol is now falling out of favour in the country.
Japan’s ageing population is reshaping the local economy in far-reaching ways, from chronic labour shortages to waning demand for homes and vehicles. But one of the quieter, and more surprising, casualties of this demographic shift has been alcohol consumption. The decline has been so pronounced that it even triggered an unexpected government intervention in 2022 when Japan’s National Tax Agency launched a campaign with a provocative goal: to encourage young adults to drink more.
Behind the controversial plan lies a serious fiscal concern. Alcohol tax revenue, once a key pillar of government income, has been steadily declining. Per capita alcohol consumption fell from 100 litres in 1995 to just 74 litres in fiscal 2022, according to official data. A shrinking and ageing population has been a significant factor but more recently, cultural shifts and financial pressures have made nights out at bars less frequent for Japan’s younger generations.