Individuals in Japan failed to declare taxable income totaling ¥20.1 billion related to new forms of economic activity, including the sharing economy, in the year through June, the government said Thursday.

The amount of penalty taxes per case came to ¥4.94 million, 1.8 times the average among the total undeclared income cases that year, according to the National Tax Agency.

The sharing economy is an economic model in which goods, venues and skills are lent and borrowed via the internet.

The agency believes that many individuals engaging in such new economic activity as a side job fail to properly declare their income because they are not accustomed to tax-filing procedures.

The agency’s regional taxation bureaus across the country investigated a total of 1,071 cases involving new forms of economy.

Of them, 432 cases were related to foreign exchange margin trading or crypto assets, 208 to online shopping or auctions, and 191 to minpaku, a type of private lodging service.

The total number of individual income tax investigations grew 16.4% from the previous year to 502,000, with undeclared income totaling ¥557.7 billion, down 29.3%, and penalty taxes ¥73.2 billion, down 35.3%.

The number of on-site investigations fell sharply amid the spread of the novel coronavirus, while that of probes through documents or telephone calls grew.

By industry, the amount of undeclared income per case was highest at ¥49.27 million in the computer programming sector.

The sex industry, which had stayed in the top five since 1997, was out of the list because the number of investigations conducted in the year was too small. Probes may have been postponed or amounts of income were too small to conduct probes amid the COVID-19 crisis, according to the agency.

On-site investigations into wealthy people were conducted for a total of 2,158 cases, with undeclared income totaling ¥48.7 billion. The amount per case hit a record high of ¥22.59 million.

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