Toyota, Aichi Prefecture, the home base of Toyota Motor Corp., is expecting more than five times more corporate tax income in fiscal 2014 than the previous year thanks to the leading carmaker's robust performance.
The municipal government expects ¥26.2 billion in tax revenue from resident companies in the year starting April 1, against ¥4.5 billion in fiscal 2013, it said in a draft budget revealed Friday.
The highest-ever increase is credited to Toyota Motor's record profit forecast for fiscal 2013 and improved showings by its business partners. The city's corporate resident tax income reached ¥44.2 billion in fiscal 2008, immediately before the financial crisis hit the global auto industry, but has stayed low in the last several years.
"Performances are recovering much more rapidly than we had expected," Mayor Toshihiko Ota told a news conference. "I want to express appreciation for the efforts made by all the companies."
The city plans to put some of the "unexpected revenue" in a rainy day fund to prepare for any sudden fall of corporate resident tax income. Of the city's planned ¥168.5 billion budget, ¥108.5 billion is projected to come from taxes on residents and companies.