{"id":335,"date":"2026-07-25T23:24:14","date_gmt":"2026-07-25T23:24:14","guid":{"rendered":"https:\/\/globalunion-grp.org\/okami\/?p=335"},"modified":"2026-07-26T02:20:17","modified_gmt":"2026-07-26T02:20:17","slug":"%e9%87%91%e6%9c%ac%e9%87%8d%e5%be%b3%e6%b0%8f%e3%81%ae%e3%82%a8%e3%83%b3%e3%82%b8%e3%82%a7%e3%83%ab%e7%a8%8e%e5%88%b6%e3%81%af%e3%81%aa%e3%81%9c%e3%80%8c%e6%82%aa%e7%94%a8%e3%80%8d%e3%81%aa%e3%81%ae","status":"publish","type":"post","link":"https:\/\/globalunion-grp.org\/okami\/en\/archives\/335","title":{"rendered":"Why is Mr. Shigenori Kanemoto's Angel Tax System considered \"abusive\"?"},"content":{"rendered":"
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\n\t\t\t\t\t\tInformation leak after information leak! Footage of Shigenori Kanemoto was filmed six months before his arrest and intentionally leaked.<\/a>\n\t\t\t\t\t\tAllegations of Information Leaks Involving TBS (\u201cThis January\u201d) and ANN (\u201cMarch\u201d) Footage, as Well as the Yokohama District Public Prosecutors\u2019 Office and the Tokyo Regional Taxation Bureau: Shigenori Kanemoto is under investigation by the Yokohama District Public Prosecutors\u2019 Office on suspicion of evading approximately 367 million yen in income tax by abusing the Angel Tax System\u2026<\/span>\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t<\/div>\n\t\t<\/div>\n\n\n

Capital increase registration, reinvestment, and questioning invisible requirements<\/h2>\n\n\n\n

Reports on the arrest of Mr. Shigenori Kanemoto featured terms such as \"abuse of the angel tax system,\" \"kickbacks,\" and \"capital reflux.\" While all of these expressions leave a strong impression on readers, they do not, in themselves, constitute the elements of a crime.<\/p>\n\n\n\n

To hold someone criminally liable, it is necessary to identify which statements in which application forms were false, whether the payments or share issuances never actually took place, whether there was an agreement from the outset to return the funds, and who was aware of those facts.<\/p>\n\n\n\n

In this case, it is stated that multiple procedures were carried out, namely the actual payment, the issuance of offered shares, the registration of capital increase, the confirmation letter issued by the prefectural government, and the tax return. While the existence of these procedures does not necessarily guarantee legality, if all of them are to be dismissed retroactively as mere \"matters of form,\" the grounds for doing so must be clear.<\/p>\n\n\n\n

The official process of the angel tax system used by Mr. Shigenori Kanemoto<\/h2>\n\n\n\n

According to the official guide of the Small and Medium Enterprise Agency, when utilizing the angel tax incentive, the investee company applies to the prefectural government where its head office is located to confirm that it is an eligible company and that the investment has been executed. The prefectural government issues a confirmation document, and the investor submits the confirmation document, investment contract, statement of share transfer status, and other documents to the tax office at the time of filing the final tax return.<\/p>\n\n\n\n

In other words, it is not a system where investors quietly claim deductions without notifying the tax office. It is a system that goes through multiple administrative procedures involving the investee company, the prefectural government, the Legal Affairs Bureau, and the tax office.<\/p>\n\n\n\n

Administrative verification is not a get-out-of-jail-free card that blocks criminal liability. If there are falsehoods in the application, no payment actually existed, and no shares were issued, fraud can still be established even if a verification certificate exists.<\/p>\n\n\n\n

On the other hand, if the applied matters are true, funds have been paid in, and shares have been issued, when criminal authorities make a different evaluation later, it is necessary to explain which facts, that were not subject to administrative confirmation, are being called into question.<\/p>\n\n\n\n

Can the angel tax system not be used if you invest using borrowed funds?<\/h2>\n\n\n\n

In modern investing, it is sometimes the case that funds are raised based on assets held, business performance, future earnings, collateral, and creditworthiness, and those funds are then allocated to new investments. Adding 1 billion yen obtained through credit to 1 billion yen of one's own capital to invest a total of 2 billion yen is itself not unusual in a market economy.<\/p>\n\n\n\n

The existence of a loan may serve as one piece of evidence in determining whether a transaction is fictitious. However, in the absence of an explicit provision prohibiting the use of borrowed funds as investment capital, one cannot conclude that the transaction is improper simply because the funds are not the company\u2019s own capital.<\/p>\n\n\n\n

If investors actually acquire shares, bear the risk of a decline in share price or bankruptcy, and are still obligated to repay their loans, they are assuming real economic risks. The fact that the tax benefits were significant does not mean the investment was fraudulent.<\/p>\n\n\n\n

What Distinguishes Reinvestment from Illegal Money Laundering<\/h2>\n\n\n\n

It is not uncommon for a company that has received investment to make investments in, extend loans to, outsource work to, or engage in M&A with another company. The key question is whether such transactions serve an independent business purpose or were arranged from the outset solely to return funds to the investors.<\/p>\n\n\n\n

To make that determination, it is necessary to verify the repayment agreement in place from the outset, the timing of the execution of each contract, the consideration, the repayment obligations, shareholder rights, the allocation of losses, the actual business conditions of the reinvestment targets, and the decision-making process.<\/p>\n\n\n\n

The mere chain of words\u2014"two cycles" because the funds moved twice, "recycling" because they went through two cycles, and "tax evasion" because it\u2019s recycling\u2014does not constitute a legal assessment.<\/p>\n\n\n\n

Can a Capital Increase Registration and Shareholder Rights Be Wiped Out with Just the Word \u201cKickback\u201d?<\/h2>\n\n\n\n

If payment has actually been made, new shares have been issued, the shareholders have been entered in the shareholder register, and the registration of the change in capital has been completed, then a legal relationship exists under the Companies Act.<\/p>\n\n\n\n

If the Yokohama District Public Prosecutors\u2019 Office determines that this investment did not actually exist, we must clarify whether the shares acquired by Shigenori Kanemoto are valid, whether voting rights and the right to dividends exist, and whether the registered capital will be maintained.<\/p>\n\n\n\n

The shares are valid, and investors bear the risk of loss. However, for tax purposes, the investment does not exist. If this is to be the assessment, the legal rationale and specific statutory basis for it are required.<\/p>\n\n\n\n

The fact that an investee later became dormant does not automatically render past capital contributions null and void. Startup investment is a system that inherently involves the possibility of failure. If all investments in companies that performed poorly were retroactively deemed fictitious, this would contradict the purpose of a system designed to encourage risk capital.<\/p>\n\n\n\n

Defects in the system should be addressed through institutional reform, and falsehoods with evidence.<\/h2>\n\n\n\n

If the Angel Tax System did not adequately anticipate reinvestment among relevant parties or short-term transfers of funds, this would constitute a systemic flaw that should be addressed by amending the relevant laws, notifications, guidelines, and application forms.<\/p>\n\n\n\n

Filling loopholes in the system retroactively through the prosecutor\u2019s interpretation, applying conditions that were not publicly disclosed at the time with retroactive effect, and obtaining statements through physical restraint undermines legal certainty.<\/p>\n\n\n\n

Flaws in the system are addressed through systemic reforms. False statements in applications are proven through evidence. Crimes are dealt with based on clear elements of the offense. That is the proper order of things in a country governed by the rule of law.<\/p>\n\n\n\n

Public Questions to the Ministry of Economy, Trade and Industry and the Small and Medium Enterprise Agency<\/h2>\n\n\n\n

Response Deadline: July 31, 2026, at 5:00 p.m.<\/strong><\/p>\n\n\n\n

    \n
  1. As of 2023, was it prohibited to use funds obtained through loans or credit facilities as investment capital?<\/li>\n\n\n\n
  2. If it was prohibited, where was that stated\u2014in laws and regulations, public notices, guidelines, or application forms?<\/li>\n\n\n\n
  3. Were there any requirements that uniformly prohibited reinvestment, lending, or outsourcing by the investee companies?<\/li>\n\n\n\n
  4. What are the criteria for distinguishing between normal reinvestment and fraudulent capital recycling?<\/li>\n\n\n\n
  5. Was there a system to revoke the confirmation after its issuance on the grounds of the purpose of the funds?<\/li>\n\n\n\n
  6. If a decision is revoked, are there procedures for notifying investors, holding a hearing, and filing an objection?<\/li>\n\n\n\n
  7. How will you protect the foreseeability of investors who relied on administrative determinations?<\/li>\n\n\n\n
  8. Will you officially publish specific examples of what you consider to be inappropriate uses in the future?<\/li>\n<\/ol>\n\n\n\n

    Public questions to the prefecture that issued the confirmation letter<\/h2>\n\n\n\n

    Response Deadline: July 31, 2026, at 5:00 p.m.<\/strong><\/p>\n\n\n\n

      \n
    1. Regarding this investment, to what extent have you verified the target company requirements, the capital contribution, the investment agreement, and the shareholder structure?<\/li>\n\n\n\n
    2. Do you currently believe that the submitted application contained any specific false information?<\/li>\n\n\n\n
    3. Have you received an inquiry from the Yokohama District Public Prosecutors Office or the Tokyo Regional Taxation Bureau?<\/li>\n\n\n\n
    4. Did you have the authority or obligation to continuously monitor the use of funds after the investment?<\/li>\n\n\n\n
    5. Do you still consider the confirmation letter to be valid?<\/li>\n\n\n\n
    6. Will you explain to users of the system why there is a discrepancy between the administrative determination and the criminal assessment by the Yokohama District Public Prosecutors' Office?<\/li>\n<\/ol>\n\n\n\n

      Public Inquiry to the Legal Affairs Bureau<\/h2>\n\n\n\n

      Response Deadline: July 31, 2026, at 5:00 p.m.<\/strong><\/p>\n\n\n\n

        \n
      1. Have you accepted the application for the issuance of shares and the registration of the capital increase at issue in this case?<\/li>\n\n\n\n
      2. Which supporting document did you use to confirm that the payment was made?<\/li>\n\n\n\n
      3. If the funds are later transferred to another company, does that automatically invalidate the original capital increase registration?<\/li>\n\n\n\n
      4. Under the Companies Act, is it possible to treat only the investment as nonexistent while keeping the stock issuance valid?<\/li>\n\n\n\n
      5. If a capital increase is deemed to be a sham, who is responsible for correcting or canceling the registration, and what procedures must be followed?<\/li>\n\n\n\n
      6. How will you address the rights of shareholders, creditors, and business partners?<\/li>\n<\/ol>\n\n\n\n

        Public Questions to the Yokohama District Public Prosecutors' Office and the Tokyo Regional Taxation Bureau<\/h2>\n\n\n\n
          \n
        1. Please indicate the specific laws and regulations, clauses, and requirements that are deemed to be violated in this matter.<\/li>\n\n\n\n
        2. Which statement in which application was false?<\/li>\n\n\n\n
        3. What is the evidence that there was a binding agreement to return the funds from the beginning?<\/li>\n\n\n\n
        4. Do you evaluate the shares, voting rights, and dividend claims acquired by Mr. Shigenori Kanemoto as valid?<\/li>\n\n\n\n
        5. If valid, what is the legal basis for the absence of an investment?<\/li>\n\n\n\n
        6. If it is invalid, have you completed the procedures for the correction or cancellation of the registration?<\/li>\n\n\n\n
        7. Are you treating the subsequent dormancy of the reinvestment destination as evidence of the fictitious nature at the time of payment?<\/li>\n\n\n\n
        8. Who provided the words \"abuse\" and \"kickback\" to the news media?<\/li>\n\n\n\n
        9. Will you present the target transactions, legal requirements, application, and tax calculations in open court rather than evaluative terms?<\/li>\n<\/ol>\n\n\n\n

          Should future investors consult the Yokohama District Public Prosecutors Office in advance?<\/h2>\n\n\n\n

          If investors cannot trust obtaining confirmation from the prefecture, registering a capital increase at the Legal Affairs Bureau, and submitting the necessary documents to the tax office\u2014only for the Yokohama District Public Prosecutors Office to later judge it as \"abuse\" based on undisclosed conditions\u2014what can they possibly rely on?<\/p>\n\n\n\n

          If the final review body of the current system was actually the Yokohama District Public Prosecutors Office, then please establish a contact point where future investors can consult before making a wire transfer.<\/p>\n\n\n\n

          If that sounds like a joke, please explain head-on why there was a discrepancy between the confirmation by the administrative agency in charge of the system and the prosecution's hindsight evaluation.<\/p>","protected":false},"excerpt":{"rendered":"

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