IBM Japan has stated its intention of appealing a potential tax demand of more than JPY30bn (USD330m) and claimed in a statement that it had fully paid all taxes required in accordance with Japanese law.
This followed a claim in the Asahi newspaper that IBM Japan Ltd. group was suspected of failing to declare more than JPY400bn in income through the tax consolidation regime. If true, this could be the largest amount of income ever left undeclared in Japan's history.
The reports quoted in the Japanese press suggested that the Tokyo Regional Taxation Bureau maintained that IBM Japan share trading had been manipulated intra-group to generate losses and evade taxation.
The share trades allegedly caused IBM AP Holdings to incur sizeable losses which were then offset against IBM Japan's profits in the tax consolidation. The Japanese National Tax Agency introduced the tax consolidation regime in April 2002.
.Tags: tax | law | business | holding company | tax compliance | Japan | tax avoidance | compliance | Japan
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