NAGOYA (Kyodo) Tax authorities have imposed ¥1.2 billion in back taxes on major auto parts maker Denso Corp., determining that its unit in Singapore does not engage in business operations and its earnings should be recognized as those of the parent firm.

The company, based in Kariya, Aichi Prefecture, said it made the tax payment Tuesday. But it plans to file an objection to the decision by the Nagoya Regional Taxation Bureau, saying the subsidiary fulfills requirements to be exempt from a rule to regulate tax evasion through a tax haven.

“There is a conflict of views between (Denso) and the taxation bureau,” a Denso official said.

According to sources, the back taxes were imposed for ¥11.4 billion in income at Denso International Asia Pte Ltd. in the two years through March 2009.

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