Tax authorities have concluded that Nissan Motor Co. failed to pay tax on ¥150 million it had booked as business expenditures in the three years through March 2014, when Carlos Ghosn served as CEO and chairman, sources close to the matter said Tuesday.
The Tokyo Regional Taxation Bureau apparently determined that the sum should not have been treated as tax-deductible business expenses as Ghosn is suspected of using the company’s money for private purposes.
For the undeclared tax over the three years, Nissan has been slapped with penalties of tens of millions of yen, the sources said, adding that the automaker could be taxed more as the bureau’s investigations continue.
In a statement released in September on its internal investigation, Nissan said Ghosn “directed or intended to direct a total of at least ¥15 billion in improper expenditures” by the Yokohama-based automaker.
The misappropriation included donations, made at his behest, totaling more than $2 million of company funds to universities in Ghosn’s home country of Lebanon “with no legitimate business purpose,” and payments of more than $750,000 to his sister via a fictitious consulting contract for over 10 years starting in 2003.
Ghosn, who was initially arrested last November, faces charges that he underreported his remuneration by several billions of yen over eight years at Nissan, and committed aggravated breach of trust. Ghosn denies all the allegations.
A Nissan public relations official said, “We will decline to comment as the investigation by the tax authorities is ongoing, but based on the internal probe we plan to take necessary actions, including legal action to claim damages, to hold the former chairman and others accountable for their deeds.”
Last week, Ghosn’s legal team claimed in court filings that prosecutors colluded with Nissan and industry ministry officials to remove Ghosn to block his efforts to further integrate Nissan and Renault SA. To do that, the prosecutors illegally took advantage of the newly introduced plea bargaining system, the lawyers alleged, saying that the charges against Ghosn should thus be dropped.