The heirs of the founder of motorcycle retailer Red Baron underreported about ¥2.8bn in inherited assets, the Nagoya Regional Taxation Bureau found in a tax audit, according to people familiar with the matter. The back taxes, including penalties, come to about ¥1.6bn. The family has already filed a corrected return.
The case is one of the larger inheritance tax assessments to surface in Japan, where the tax applies to estates above a basic deduction and rises steeply for the largest fortunes. The bureau's finding was reported on Thursday.
A national chain built on used bikes
Red Baron is a major motorcycle retailer. The company has also drawn scrutiny on trade rules: the industry ministry warned it over exporting bikes to Russia via detours without approval.