Nissan loses wage incentive over supplier underpayment issues

Nissan tax incentive revoked: Nissan Motor, a Japanese automaker, has been barred from accessing a tax incentive designed to support companies that increase wages. This decision comes after reports surfaced of Nissan's misconduct involving the underpayment of numerous suppliers, as detailed by the Yomiuri newspaper.

Previously utilising this tax benefit, Nissan will now be unable to avail it for a minimum period of one year, according to the Yomiuri. These tax incentives were originally expanded under the Kishida administration's initiatives aimed at incentivising businesses to raise wages.

Nissan supplier underpayment

Last month, Japan's fair trade watchdog revealed that Nissan had engaged in unlawful underpayment to 36 suppliers, totalling approximately 3 billion yen ($20 million) over a span of roughly two years starting from January 2021.

In response to these allegations, Nissan stated that it had reimbursed the affected suppliers and pledged to bolster its oversight mechanisms.

As of now, Nissan has not provided any comment on the matter, with enquiries remaining unanswered outside of regular business hours.

(With Reuters Inputs)