OSAKA — Tax authorities have ordered major trading house Marubeni Corp. to pay 1.2 billion yen in back taxes, it was learned Saturday.
Industry sources said the company failed to declare 3.5 billion yen in income in the four years to March 31, 2001. Marubeni paid about 800 million yen to a local agent in Nigeria, declaring it as commission fees for selling printing machines to the country during the four-year period, they said.
The Osaka Regional Taxation Bureau concluded that the money should have been booked as a taxable expense since it was actually used to pay for the company’s activities to obtain the export orders for the machines.
Marubeni is believed to have already paid the back taxes to the taxation bureau.
“We think the payment to a local agent was a proper price for its business. Although there was a difference of opinion with the taxation authorities, we followed their order in the end,” a Marubeni spokesman said.
The Osaka-based firm is also suspected of trying to conceal about 1 billion yen in income in the three years to March 31, 2000.
Marubeni is also alleged to have improperly designated 1 billion yen it paid to its workers who were on loan to overseas subsidiaries and affiliates. The salary increases were paid to cover the difference between workers’ overseas salaries and their previous salaries in Japan.
But the taxation bureau said the expenditure should have been reported as a donation — rather than as personnel costs — because the subsidiaries and affiliates were capable of paying the difference.
Marubeni, established in 1949, is one of the six largest trading houses in Japan. Its consolidated sales in the business year that ended on March 31 ranked fifth among the six.
The case came to light following a bribery scandal in August involving workers of Mitsui & Co., another major trading house, over an official development assistance project for Mongolia.
The export of the printing machines to Nigeria was not part of an ODA project, Marubeni said.
Itochu Corp., another trading house giant, was also accused in January by taxation authorities of failing to properly declare some 400 million yen in taxable income over a nuclear power plant construction project in China.
Customs authorities searched Marubeni offices on suspicion of evading taxes related to imports of octopuses from Africa in June 2001.
The Fair Trading Commission also penalized Marubeni Chikusan Corp., a subsidiary, in March for allegedly mislabeling Brazilian chicken as domestic chicken from 1999 to 2001.
In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.