November 24, 2011
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2011 November 23 - 29 [ECONOMY]
Major shareholders sell their stocks to ‘save’ 3.3 bil. yen in tax breaks |
This is because the government changed the definition of a “major shareholder” who cannot receive the preferential securities taxation in June, and enacted a law to extend for two years the ongoing preferential tax system to securities holdings from the one with the shareholding ratio of over 5% to that of over 3%.
The Finance Ministry estimated that the law would bring about an increase in taxes for about 1,300 large shareholders, which would result in a 6.8 billion yen increase in income tax revenue.
However, according to the interim financial reports, at least 250 major shareholders reduced their shareholding ratios from 5% to less than 3% within a year in order to keep receiving tax breaks on securities holdings.
This enabled these large stock owners to save about 3.3 billion yen tax payments (2.7 billion yen income tax and 600 million yen residential tax). This siphons off 40% of the revenue increase estimated by the Finance Ministry.
Kyocera Corporation honorary president Inamori Kazuo is at the top of such tax-evading major shareholders lowering their share ownership. Inamori in late March was recorded as holding more than 6.8 million Kyocera shares (3.56 % holding ratio). In Kyocera’s latest interim report, the number of his shares is 1.2 million less than in March (2.93% holding ratio). As he is not a “major shareholder” as defined at present, he can get a tax preference and save 330 million yen in tax payments.
Inamori as Japan Airlines president is the person responsible for dismissing airline workers. His management policy of giving priority to corporate profits before aviation safety was severely criticized in the Diet.
The Kyocera financial report clearly reveals Inamori as being eager only to save his own tax exemptions.
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