The heavily discounted land deal in Osaka involving a school operator at the center of favoritism allegations against Prime Minister Shinzo Abe has recently drawn renewed criticism following a report that relevant Finance Ministry documents were falsified.
Police are investigating the death of the official in Kobe in western Japan and suspect he committed suicide, with some media reporting a suicide note had been found.
Separately, Finance Minister Taro Aso told reporters that another senior official involved in the scandal, Nobuhisa Sagawa, had chose to step down after lawmakers and taxpayers demanded his resignation.
National Tax Agency head Nobuhisa Sagawa has made a decision to step down to take responsibility over the controversy linked to a state-owned land sale, a government source said Friday.
The ministry plans to tell the Diet as soon as Monday that it has found several instances where content present in the original versions of the documents was removed later, the sources said.
Media reports said the land was sold for around a tenth of its market value, and that the kindergarten had announced plans to name Mr Abe's wife Akie as the honorary principal of a primary school being built on the same plot.
The latest twist in the land sale scandal has seen the former head of the ministry's Kinki bureau, who had come under fire for allegedly making false remarks about the sale to the Diet a year ago, resign on Friday from his subsequent job as head of the National Tax Agency.
Abe's wife Akie had been named honorary principal of the planned school, but she stepped down in February a year ago after the details of the sale began to attract public scrutiny.
Prime Minister Shinzo Abe's wife was initially set to be the honorary principal of an elementary school that Moritomo Gakuen planned to open last April.
The allegation has paralyzed the Diet in recent days, with some opposition lawmakers boycotting debates.
The revelation of the male official's death comes at a time when opposition parties are stepping up their offensive against the government after a major daily newspaper alleged last Friday that relevant Finance Ministry documents have been doctored.