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TOKYO (Kyodo) – Google LLC has been reported to have reported about $ 3.5 billion ($ 32 million) in revenue for the year ending December 2015 in Japan.
It was believed that the Tokyo tax authorities have determined that the Japanese unit is reducing income by shifting from local advertising revenue to a Google affiliate in Singapore, where tax rates are lower. The Japanese office has already refunded taxes and fines of around 1 billion yen, as the source points out.
Although the Japanese unit sold advertising and offered domestic advisory services, its customer payments were made to a Singapore company. The Japanese unit received a salary equivalent to its total business expenses, plus an 8% commission from the Singapore office.
The Tokyo Regional Tax Office pointed out that the Japanese company 's pay does not match the advertising revenue, as the source points out.
The underestimation of Google unit revenue was due to the growing concern that international technology giants, including Apple Inc., are reducing the tax burden by shifting profits to countries with lower corporate tax rates.
After the tax office emphasized dubious accounting practices in 2015, the Google Japan unit voluntarily reported an additional 6 billion yen of corporate income by December 2016, indicating the source.
Kyodo News sent a Google Japan unit to search for comments, but received no response from Tuesday morning.
The Japanese unit of the company was founded in 2001 as a joint stock company, but in 2016 it became a limited liability company, which means that it is not necessary to omit the financial income statements.
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