The Japanese tax authorities have ordered major multinationals such as Sony, Mitsubishi and pharmaceutical giant Takeda to pay billions of yen in extra taxes over the tricky transfer pricing issue.
Over the last week, the government has aksed Takeda to pay 57bn yen (£269m) in additional tax. Sony has had to pay 27bn yen extra and Mitsubishi had to cough up 2.2bn yen
Transfer pricing concerns how companies in different countries that are part of the same group should pay each other for goods or services. This affects the sums of tax payable to each national tax authority.
Hiroyuki Kamano, from Japanese law firm Kamano Sogo, said the tax authorities were clamping down on transfer pricing to raise more taxes in order to address Japan's large fiscal deficit.
Japan's taxman hammers Sony and Mitsubishi
By Nicholas Neveling on Jul 6, 2006 11:57AM