OSAKA -- Osaka-based drugstore firm Daikoku and its affiliates failed to declare about 200 million yen in corporate and personal income for five years up to 1999, industry sources said Wednesday.
Audit investigations by the Osaka Regional Taxation Bureau found that Daikoku, which operates some 40 drugstores in Osaka, Tokyo and nine other prefectures, did not report the income of the firm and that of its 53-year-old chairman, Yasufumi Kambe, the sources said.
The company, its four affiliates and Kambe were ordered to pay additional taxes and penalties totaling 70 million yen, they said. The drugstore firm has already submitted a revised income statement.
Daikoku allegedly transferred kickbacks from wholesalers and part of its profit from sales to a secret bank account, slashing the amount of income. It also posted fictitious personnel expenses in its accounting book, the sources alleged.
The undeclared income is believed to have been used to open new drugstore outlets, the sources said.
The firm declined comment on the alleged tax evasion.
According to a private credit-research agency, Daikoku was established by Kambe in 1974 and under went a rapid expansion. The company, which now operates several 100 yen discount shops, posted sales of 18 billion yen and opened 11 new outlets in the business year that ended in August.