OSAKA -- Nankai Electric Railway Co. failed to declare about 350 million yen in taxable income over three years to March 31, 2001, and tax authorities slapped the carrier with back taxes, industry sources said Friday.
Of the 350 million yen, the Osaka Regional Taxation Bureau considered about 10 million yen to have been intentionally concealed by the part of the Osaka-based railway. The bureau fined the company about 110 million yen, including back taxes.
The sources said Nankai chalked up about 10 million yen as depreciation costs for one of its facilities before the facility was put into use. The bureau concluded that the railway should have posted the costs after the facility actually went into use and that the accounting gimmick was illegal.
Tax authorities also told Nankai there was more income it failed to properly declare during the three years. But they found the undeclared sum was not the result of illegal accounting practices and imposed light penalties on the company, the sources said.
A spokesman for Nankai, which is listed on the first section of the Osaka Securities Exchange, said that the carrier and the tax bureau held different opinions, but that the company obeyed the bureau's orders.
Nankai, established in 1885, is the second-largest private railway in the Kansai region, with lines in Osaka and Wakayama prefectures.