People are taking a growing interest in how the national budget of 106.6 trillion yen for the fiscal year 2021 will be spent. Of particular interest is the five trillion yen that has been earmarked as a reserve fund for countermeasures against Covid-19. Japan’s total expenditure on coronavirus countermeasures is the second largest in the world after the United States. In addition, two trillion yen has been set aside as a dedicated fund for realizing a carbon-free society. The government says it will continue to support technological development of hydrogen, next-generation storage batteries, and other technologies. A budget has also been given to the Digital Agency, which will be established in September 2021 to realize the digitization of government administration, which Japan has fallen behind with. The biggest amount in this year’s budget is 35.8 trillion yen for social security, which makes up one third of the total. The second largest item in the budget is the government debt which stands at 23.8 trillion yen, followed by 15.9 trillion yen in grants distributed to local governments. These top three account for 70.9% of the total national budget. Funds for public works expenditures, cultural, educational and scientific activities, as well as for defense, each account for 5% to 6% of the total. On the other hand, the government’s annual income from taxes, which is its main source of income, totals only 57.4 trillion yen. The shortfall is made up by the national debt, which totals 43.6 trillion yen. The reality is that Japan᾽s national budget is financed by debt. The total debt exceeded 1,200 trillion yen at the end of 2020. That means that Japan has one of the world᾽s highest levels of national debt. The reason that the Japanese economy is still secure is that most of the national debt has been borrowed from within the country. At the same time, Japan is one of the world᾽s biggest lenders to other countries and exports have kept the trade balance in the black. In other words, Japan earns more than it borrows. While the coronavirus crisis has taken attention away from the issue, for the ninth year in a row, defense spending has continued to increase. Also, worries have been voiced concerning the increasing size of the reserve fund, which can be used by the government without debate or investigation by parliament. It is said that many Japanese people are indifferent to how the national budget is allocated and to how their tax money is used. However, due to the long-running coronavirus crisis, attitudes are changing.