February 19, 2011
TOKYO (AFP) - A Japanese court has ordered the government to give one man a record $2.4 billion tax refund, newspapers reported Saturday.
The Supreme Court ruled tax authorities had no right to ask for 160 billion yen ($1.92 billion) in gift tax from Toshiki Takei, a former director of consumer loans firm Takefuji Corp., the Yomiri Shimbun said.
The court said the government should give the money back to Takei, who experts estimate will be entitled to interest at four percent, taking his payout to 200 billion yen.
Interest rates on bank savings in Japan are currently around 0.02 percent.
The sum is the largest-ever tax refund for an individual and twice as big as Japan's entire gift tax revenue over a year, the newspaper said.
Takei was ordered to pay the tax after receiving shares in a Dutch company from his parents in 1999.
He had argued that he had been living in Hong Kong at that time, but authorities maintained his residency was temporary and a way of avoiding paying Japanese tax.
On Friday the Supreme Court ruled Takei spent more days in the Chinese city than in Japan in the years around the stock gift and was therefore technically resident there, reports said.
Takefuji, which was once the nation's top consumer finance company, filed for bankruptcy protection with the Tokyo District Court last year with liabilities of 433.6 billion yen.
The lender, which called itself a "yen shop", has been hit by a deluge of claims by customers for refunds of high interest charges.
"What will be returned to Mr Takei is an asset originating from excessive interest (charged on borrowers). We want the entire money back," Yoshio Honda, a lawyer for former Takefuji customers, said Friday, as quoted by Jiji Press.
The news agency and other media said up to two million customers were entitled to seek interest payment refunds in accordance with a 2006 court ruling.
Should all of them do so, Takefuji's liabilities could exceed two trillion yen, according to Japanese media.
