Denso pays penalty tax of ¥6 billion

Kyodo

Auto parts manufacturer Denso Corp. said it paid around ¥6.1 billion in additional taxes on roughly ¥13.8 billion in income from a Singapore unit, which Japanese tax authorities ruled should have been reported.

Denso also said Monday it plans to file an objection.

The Nagoya Regional Taxation Bureau determined the subsidiary is subject to provisions of the special tax law concerning tax haven entities, and thus its profit over a two-year period through March 2011 constituted income for the parent company.

Denso said it believes the subsidiary is eligible for an exemption to the law intended to discourage businesses from setting up operations in tax havens.