Nissan disqualified from Japan wage hike tax incentive

Nissan Motor Co. has lost its eligibility for a Japanese government tax incentive designed to encourage companies to raise employee wages. The disqualification follows the Japan Fair Trade Commission's (FTC) findings that Nissan unlawfully reduced payments to 36 suppliers by about 3 billion yen ($20 million) over a period from 2021 to April of the following year. The automaker has since reimbursed the affected suppliers and has committed to enhancing its compliance systems.

The tax break from which Nissan has been excluded aimed to reduce corporate tax for companies actively increasing wages as part of broader efforts by the Kishida administration to promote economic growth and counter rising living costs. With Nissan's removal from the list of around 44,000 eligible companies, it will be unable to benefit from the incentive for at least one year, potentially affecting its financial performance. The delisting of Nissan from the Economy Ministry’s website is a part of the government's measures to enforce fair trade practices and ensure companies uphold commitments to proper dealings with subcontractors.