The Tokyo Regional Taxation Bureau has judged that plant engineering firm Ebara Corp. concealed 290 million yen in income over a two-year period ending in March 2002, sources said Monday.
The tax authorities have concluded that commissions the Tokyo-based company paid to a civil engineering firm in obtaining a public works contract in Osaka were nondeductible expenses, the sources said.
They also judged that funds Ebara paid to other firms as subcontracting fees were in fact in return for pulling out of bids for public works projects in six prefectures, meaning they were also nondeductible expenses, the sources said.
These and some accounting errors boosted Ebara’s undeclared income to some 1.5 billion yen.
But because Ebara was making losses throughout the period concerned, penalty and back taxes totaled around 5 million yen.
Ebara has already paid up, the sources said.
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