IBM Japan may not have reported $4.4 bn income

Japanese tax authorities have accused IBM's Japan unit of failing to report more than USD 4.4 billion in income, and the unit may be asked to pay more than USD 300 million in back and additional taxes, the Asahi newspaper said.

IBM Japan spokesman Motoyuki Suzuki said that taxation authorities had asked for a correction in the amount of taxes paid but that the company believes it has made its filing in line with the law and intends to appeal.

The Asahi said 400 billion yen (USD 4.4 billion) in income would be the biggest unreported amount discovered by Japanese tax authorities.

The newspaper said IBM Japan had made a profit in 2008 on its operations but a sale of shares within its group structure led it to report a loss and make no tax payment. Japanese authorities have determined that the moves constitute tax avoidance, the paper said.

A spokesman for Japan's taxation bureau declined to comment on the report.