Tokyo officials are demanding Apple pay $98 million in back taxes after the company mistakenly exempted resellers and foreign tourists from a consumption tax. According to Nikkei, Apple stopped offering tax-free purchases in June after erroneously exempting bulk purchases of iPhones and other hardware.
The $98 million bill taxes is based on Apple Japan’s $26 billion in sales for the fiscal year 2022. And it is believed that Apple has filed to amend its tax return. Visitors to Japan who are staying for less than six months can shop tax-free. But resellers are not exempt from paying taxes.
According to a source, foreign customers bought iPhones in bulk at some Apple stores, according to Nikkei. At least one transaction involved a person purchasing hundreds of handsets all at once. This indicates that the retailer may have forgotten to charge a possible reseller’s tax.
According to the publication, Tokyo’s tax authorities have since last year dropped tax bills against at least two other significant retailers for the same reason. According to Nikkei, Apple Japan’s tax bill of 13 billion yen is one component of over 100 billion yen in unpaid consumption taxes.
Apple CEO Tim Cook visited Japan for a portion in order to visit Sony and other iPhone component suppliers. Recently, Japan’s government put pressure on Apple to support multiple iPhone app stores. In Japan and other countries, Apple’s App Store revenue recently fell to record lows. Competition may make that issue worse as Apple is rumored to allow third-party app stores starting in Europe next year.