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Updated Friday, March 19, 2010 10:48 am TWN, AP



	A man walks past the headquarters of IBM Japan in Tokyo yesterday. Japanese tax authorities have accused IBM's Japan unit of failing to report more than US$4.4 billion in income, and the unit may be asked to pay more than US$300 million in back and additional taxes, the Asahi newspaper said. (Reuters) Enlarge Photo

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IBM Japan to appeal gov't tax evasion assessment report

TOKYO -- IBM's Japan unit said Thursday it will fight an assessment by tax authorities, who reportedly investigated the company for failing to declare more than US$4.4 billion in income. IBM Japan could be ordered to pay the Tokyo Regional Taxation Bureau more than 30 billion yen (US$332 million) in back taxes, according to the Asahi newspaper. The bureau suspects IBM Japan of underreporting 400 billion yen in taxable income in 2008 through an accounting scheme that allows a parent company and its subsidiaries to file taxes as a single entity, Asahi said without citing sources.

IBM Japan allegedly traded its own shares with its Japanese parent company IBM AP Holdings, with the resulting loss offsetting profits by the Tokyo-based company. IBM AP Holdings is owned by IBM Corp., based in Armonk, New York. IBM Japan denied any tax evasion and said it has paid legally required taxes in full. It plans to file an appeal of the assessment, said spokesman Kazuhiko Suyama, without elaborating.

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