Cosmic Truth Society fined for tax dodge

Religious group hid 1.4 billion yen in income from ‘love hotels’

Japan — A religious body that operates “love hotels” in five prefectures hid some 1.4 billion yen in income in the seven years up to February 2008, it has been learned.

The hidden income was discovered by a Kantoshinetsu Regional Taxation Bureau investigation of the Uchu Shinri Gakkai religious group, which operates love hotels in Gunma, Nagano, Niigata, Gifu and Shizuoka prefectures. According to a source close to the case, the group apparently categorized some 40 percent of income earned from love hotel room rates as tax-exempt religious offerings, and may incur a tax penalty of around 300 million yen as a result of hiding the revenue.

At one of the group’s love hotels in Nagano, there is a statue of Kannon at the entrance with a sign reading, “Uchu Shinri Gakkai Religious Body,” and other signs to the left reading “Please give alms,” and, “Please offer your hand to the poor children of the world.”
[...]

The religious group Cosmic Truth Society hid ¥1.4 billion in taxable income by disguising revenues from its love hotels in five prefectures as offerings, sources alleged Tuesday.

The Kantoshinetsu Regional Taxation Bureau imposed a ¥300 million penalty and added taxes on the group known in Japanese as Uchu Shinri Gakkai, the sources said.
[...]

The association, which is believed to be effectively run by a man who lives in Chikuma, Nagano Prefecture, runs 23 love hotels in Nagano, Gunma, Niigata, Gifu and Shizuoka prefectures. The religious entity was founded in 1983 but remained dormant until 1994.
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The group – Uchu Shinri Gakkai in Japanese – is objecting to the penalty imposed, insisting the money went to help needy youngsters.

One hotel manager was quoted in the Japanese media as saying that the room rate was 5,500 yen ($55, £34) and that 2,000 yen of that was donated to charity.

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