In the late 1980s，Japan’s bubble economy expansion is closely related to its fiscal policy.The drawbacks in the land tax system promoted people to excess demand for land assets，inhibited the supply of urban land，thus pushed up land prices.The tax system reform in 1986 stimulated the investment of the individual and enterprises in the real estate market，aggravated the bubble of real estate.Facing sharp appreciation of Japanese yen in 1985，the Japan adhered to fiscal balance doctrine so as to over depend on monetary policy in macroeconomic adjustment；however the sharp increase in the quantity of money supply provided condition for the real estate price expansion.In 1987，an expansionary fiscal policy was put in place，increased land exploitation spending，leaded to a large number of private investments in the real estate market，and further stimulated the real estate bubble expansion.