TOKYO – The digital barrier used by Japanese tax evaders to hide from tax authorities may soon be coming down, as a new rules will soon be set out to grant tax inspectors power to inspect digital records.
By the end of the month the Ministry of Finance of Japan is set to release proposed new legislation allowing tax authorities to access digital records kept on the computers of alleged tax evaders.
Currently tax legislation in Japan does not explicitly allow tax authorities to conduct overnight raids on alleged tax evaders, or seize the digital data stored on the computers and servers of alleged tax evaders.
Under the scope of the expected rules, tax inspectors will be allowed to copy and utilise the data stored on the evader’s digital devices.
Further, tax authorities will be eligible to request any data held on online accounts or cloud services.
Presently some service providers and ISPs do accept requests for information from authorities, but they face potential legal action from the account holders for violation of their privacy.