AfterDawn: Tech news

Sony ordered to pay $250 million in back taxes

Written by Dave Horvath @ 30 Jun 2006 6:05 User comments (51)

Sony ordered to pay $250 million in back taxes Recent news has shown some possible insight as to the price point of Sony's newest gaming console, the PS3. At the gaming industry trade show known as E3, Sony shocked the world when it announced it's new PS3 will go on sale for an astounding $599. Could it be that this inflated price may have been a foreshadow of their financial outlook?
The Tokyo Regional Taxation Bureau notified Sony and Sony Computer Entertainment Inc that a reassessment of reported profits for the financial year ending March 2000 through to March 2005 resulted in a 74.4 billion Yen difference in their taxes. The tax bureau then ordered Sony to pay an additional 27.9 billion yen ($243 million) in taxes related to transactions between its game unit and its U.S. subsidiary.

"Sony and SCEI believe that their allocation of income for the periods in question was appropriate and that they have paid the proper amount of taxes in each of the jurisdictions," Sony has said in a statement.


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51 user comments

130.6.2006 6:12

Could it be that this inflated price may have been a foreshadow of their financial outlook?
Sony can burn for all I care! High prices, maximum excuses! I bet they'll have somethng planted on those PS3 game discs!

230.6.2006 6:22

SONY used to be an outstanding company... Now they are very shady to me, like many of the other big corporations...I hope bluray loses in the format war.

330.6.2006 6:30

munx SOny has not been all that for a decade...,mabye when the PSX frist came out but its been down hill from there. I wonder if this is becuse of bad games effecting what poeple buy or just a sign of the times...

430.6.2006 7:52

very sad times in the gaming world.. my as well buy a computer PC for that kind of money

530.6.2006 7:53

Lol! I hope this doesn't prompt an increase in prices.

630.6.2006 7:59

watch the game r prolly gunny be dang near a 100$ a i hope this system is worse off then xbox 360 i hope instead of over heating it blows up and causes damage then people will sew sony and they might re think ther stupid prices and for what this system is worth i bet it ends up like the ps2 a peace of garbage srry i dont want to pay 599$ for a shiny hunk of scrap plastic and metal

730.6.2006 8:37

then buy the Wii if you don't "...want to pay $599 for a shiny hunk of scrap plastic and metal."

830.6.2006 9:06

I just wonder if they hope to sell more to pay off the taxes with the release of the Ps3.

930.6.2006 9:09

Sony fans should just stick to the ps2...what sony fans should do is not buy the ps3, keep the ps2 and when it is completely obsolete (1 year or 2 after ps3's release) the ps3 will already be cheaper...dont feel bad that ur buying ps2 games instead of nice and sexy ps3 grpahics...ps2 graphics are still good and when you get the ps3...ur ps2 games will work! (plus u can sell ur ps2) Having said that: I hate obviously has good sides about it such as using the psp as a rearview mirror in racing games but it's strong points are overwhelmed by it's weak points... Xbox 360 is live tho sucks (it's good but for the price I'd rather use x-link) Plus it has Halo 3 (will have)!! All Blu-ray will be good for is movies...for games, bluray will only have the benefit of being able to buy games fro0m another country and play it in ur language from ur country...for that huge price..ya, some benefit... The Wii is what will own the market...strong points is motion sensing technology enabling the "greater use" for fps games...completely new stuff which will make gaming fun...its weak points are: 1. Too many stupid games like mario stuff... 2. This shouldn't be a weak point because they are still next-gen but the graphics are weaker than other consoles... Bottom keep ur ps2 and buy a Wii for next-gen if ur a Sony fanboy, either that or dont buy a next-gen console until the ps3 is cheaper...but u gotta live with the ps2 for that time being... P.S. I probly got off-topic...but its just to help sony ppl make their "decisions" Here is what I think will happen: 1st place:ps2 (because more ppl have it) 2nd place: Wii 3rd place: Xbox 360 4th place: ps3

1030.6.2006 10:14

"an additional 27.9 billion yen ($243 million) in taxes" If Sony is being required to pay an ADDITIONAL $243 million in TAXES what the heck were their PROFITS??? Holy smokes! With that much profit it's hard to imagine that the price of the PS3 is tied to their tax bill. IMHO it's to maintain those big profits. No more subsidizing console prices with game sales.

1130.6.2006 11:28

Mario a weak point? I dont think so, at least not many many people. I myself agree that the PS2 is a great system but I still like my GC over all my systems (except SNES). There just was too few games that were must haves for Nintendo. I will not buy the PS3, not right away... my money is on the Wii and then on the XboX 360 then on to the PS3 in time. Most people have no clue that all games that are across the systems will be made for the 360 and then ported to the PS3 so there will be no difference in the graphics or speed of the games. Only exclusive games for the PS3 will do a better job and then remember that developers still have a year on the 360 that they dont on the PS3. I myself really dont understand the whole graphics affair anyway, Ive played plenty of games that look good and play like crap. I just wish MGS4 would come to the 360 because then I wouldnt have to entertain buying the PS3 anyway. I hope the Wii is the leader overall, Nintendo has always gone above and beyond for gamers. They have killer manufacturing and then the official seal of Nintendo to back them up! I think Snowny is a very shady company overall, I dont like them. Uncle Bill has been a thief since day one so that is no surprise.

1230.6.2006 11:52

lol. Could it be all those lawyers' bills?

1330.6.2006 12:34

Yes it has to be the lawyer bills!!! j/k. Maybe the next enron.....

1430.6.2006 13:13

Most of you have no business sense whatsoever, and are blowing this story way out of proportion. Corporations routinely keep reserve funds for such occasions, which are not uncommon at all. This is no big deal and means nothing. Sony, as a company, is as stout and healthy as ever. Sony stock closed at 44.04 today, which was off 14 cents (or -0.32 percent). So, investors sure are shaking in their shoes at this news (LOL!)

1530.6.2006 14:26

Do NOT run to get your hot little hands on the PS3 "just to have the latest".... WAIT !!! That's right, WAIT.... It'll come down, they always do !!!! Just because you can afford it.... WAIT !!! These greedy, corporate capitalists need US to put them into place. This is rediculous. Pretty soon, IF PERMITTED BY US, console gaming will become a rich mans commodity. I know it may be tough, but even if "mom and dad" ask if you want one... Surprise the hell out of them and tellim' NO, and tellim' WHY !!!!! Realize this as well, for all reality, you most likely are not getting the "newest" tech in Console Gaming... I tend to believe when a company comes out with one item, they already have the Next, Hotter outfit right in hand already... Does anyone remember aways back when Intel came out with the 386DX CPU it was found they were actually crippled 486 chips. (I believe it was BYTE magazine that reported that many moons ago now) It's alllllllllll marketing............. Hold out for the Better Deal !!!!! Highly Advisable....

1630.6.2006 14:54

Nicely said, BentlyCar!

1730.6.2006 16:28

sha nah nah nah hey hey goodbye

1830.6.2006 17:23

I wish I could lose track of $750 Million.

1930.6.2006 18:43

SONY is the best out there in consoles. Haters have been owned.

2030.6.2006 21:06

"SONY used to be an outstanding company... Now they are very shady to me, like many of the other big corporations...I hope bluray loses in the format war."- Couldn't agree more, KCUF ynoS. "SONY is the best out there in consoles. Haters have been owned."- Since when? Playstation 2 is inferior hardware-wise to Gamecube and Xbox, and if you try to talk about how many games it has think about how many of them you ACTUALLY play that you can't play on any other system. Use your head. To be totally honest, PS2's GPU is only a cut above Dreamcast( which was a great system I might add). Hence why GTA looked a million times better on xbox. PS. and just for the record a MOD-Box kicks ass!!! "Corporations routinely keep reserve funds for such occasions, which are not uncommon at all."- Yeah I knoooow, cause it's like everyday company's are PAYING hundreds of millions of dollars to people for no reason. Really stfu. Maybe if sony made products that turned a profit and hired compitent employees to do their books they wouldn't be having this problem.

211.7.2006 0:22

PS3 is just the most over-priced expensive piece of crap! Its a ps2 with a new case and new processor... The only game that i am excited about on ps3 is MGS4... (all the GTAs will be on PC thank god lol)

221.7.2006 5:53

"Playstation 2 is inferior hardware-wise to Gamecube and Xbox" Hei! PS2 Hardware much better than GC, but its true XBOX is superior to PS2 And, the reason i will buy PS3, is the games, from ps1,ps2, sony always have good games, thats why i did not buy XBOX, and Buy PS2. but, if many japan developer (square, namco, tecmo, etc) make their games in XBOX360, maybe FF, MGS... im sure I will buy Xbox360 (its cheaper, and use normal DVD, so i can make backups easyly) hmm, i will stick to my PS2 for 2 years more, although ps2 really crappy(my ps2 is 2yrs old, and i have replaced the laser lens 3 times) and when PS3 price went down, or XBOX360 have good games, i will decide to buy xbox360 or PS3

231.7.2006 6:19

jutsu thats why I have yet to get a Xbox dosent realy have games,PS2 had the most so I got it frist,then a CUbe,the 360 so far has nothing I give a damn about,the PS3 currently is ok but ok is not good enough to shell out 600 for its stupid,they will have the games in acouple years but for now its merely soemthign to watch. If the 360 had full backwards complity I'd would have gotten it by now but sicne they rushed it and the hardware has not been full repalced (I lost my notes on the 360 what date are the newer hardware 360s? when I get one I dont want to buy a friest generation 360 ><)

241.7.2006 8:29

Scary stuff here boys............You idiots....if sony is gone then so will videogames......Sony is a good guy even if they old more than I can count in taxes....

251.7.2006 13:28

what are you talking about video games will never be gone and as for the 250 mill. thats chump change to them. MR whatever his name is, probally keeps at least 300 mill In his back pocket. I like the Playstation stuff from sony thats about it. They should drop everything and just work on games but they would lose to much money.

261.7.2006 13:32

Seems a bit ironic: One of the loudest voices against software/movie/music piracy may well be involved in tax piracy! Sounds like another case of "...the pot calling the kettle black...". Maybe the government should issue money on Blu-ray discs so it wouldn't be so easy to steal!!! Forgive me if I laugh out loud, but this is good stuff!

271.7.2006 13:48

hahaha ..steal , Do whatever but SONY wants # 1 spot! I hate SONY

281.7.2006 14:17

vgaddict8 *falls out of his chair* thats like saying if MS went the PC would dissappre Sony is not even 1/3th of the market if they up and vanshied the games published by them would be took over by someone else and life will go on. Brewluvr If it effects the bottom line they will try and whine about it *L*

292.7.2006 11:17

As far as I am concerned.....the videogame market only consist of Sony and Microsoft. SONY is the GODFATHER people.........Without them... videogames will be RETARDED and we would be playing only games made for 2 year olds. LONG LIVE SONY!!!!

302.7.2006 12:09

vgaddict8 Uummmmm no.... If the PSX didnt come along,Sega would still be makeing systems and share the welth of games with nintendo ,sicne the cube soem M rated games and soem T rated games you cant call the Cube a kiddy system,plus sicne the n64 days nintendo is not goign to turn away M rated games. the Xbox has stolen PC games to build itself up so meh,its ture the Wii focuses on everybody gameing frist but the reasn for it is becuse of the PS2/3 and Xbox ,they dont ahve to spend more moeny to have a wider selction of games,and the qauilty of some frist party nintendo games are better than anythign seen on the other systems in years....but then again dose one uber grate game repalce 5 ok ones? *L0L*

Copyright infringement is nothing more than civil disobedience to a bad set of laws. Lets renegotiate them.

Check out my crappy creations

312.7.2006 19:36

Sony might have more games then any other system, but almost all the games suck. The only reason a person would buy a playstation is to play a so called good game that is not available on any other system. Half you people shouldn't comment on the graphics or quality of other systems! Your parents probably bought you your PS2 and a few stupid games and all you can do is put down other systems to make yourself feel better because you can't afford a 360, let alone the original xbox. Sony should be ordered to pay back all the people who have bought their stupid games. Games available on multiple systems is a good way to go gives people a choice of what system they want to play the game on, MGS4 won't be available on anything else because that is the only game which is wanting people to buy the PS3.

322.7.2006 19:49

The best pack, the best console, the best games, Backward, bluetooth,WiFi ready, HDMI, 1080p, blue-ray. nothing else to say!

332.7.2006 22:15

Sony makes enough profit to pay the quarter of a billion dollars.

342.7.2006 22:32

Even if sony has all that money to have so much taxes, I don't care. I still want PS3 and im going to get it, unless it;s the $500 version, then no. I wouldn't be suprized though of sony ripp's us off and tells us we're paying $40 a month to play online.

353.7.2006 3:12

Just maybe they have been spending a little too much time and money on DVD protections, instead of considering their bottom line hmmmmm D

363.7.2006 4:47

chubbyInc when you ahve 3 or 4 times the numver of gams anyone else dose its oging to look like are the best becsue you have the most b.Most of the games suck (but if you avrage it out the PS3 has as mnay desent games as half of all the Xbox games) and theres always C SOny suxs becuse its not XBOX *L* or whatever *L*

373.7.2006 5:27

I wish I could lose track of $750 Million.
Man, aint that the truth! :)

383.7.2006 5:35

Jamaal10 shit I lsoe track of 10's 20's and 30's 0-o I bleed moeny >< of corse it might help if I stop getting a radom game a riend is loking for *L*

393.7.2006 18:44

Anyways, Sony will compensate for that 250 million dollars, and guess who is going to have to pay it, the fans.

403.7.2006 23:04

good point the wii will prolly win cuzz it is more affordable for the comman man the ps3 is barking to much money for a game console i computer i can see that much money ya ur prolly right the wii will come ontop of of the next gen consoles

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414.7.2006 7:22

The Wii is well priced, I just don't get why the Xbox and the PS3 missed the boat.

424.7.2006 16:05

Hot ice I wouldnt be suprised that all coperations are owen buy one larger coperation like the coffe houses in Dues ex 2,they way thigns work out one is good for 5-10 years then anothers turn..then anothers turn 0-o its freacky..I eman they could amke a kiling with the PS3 with a upgrade model 299 base,190 for the HDMI things and 30-50 a pop for the rest,sell the complete high end for 700...but nnnoooo.... mabye I'll buy my peices.... *L*

Copyright infringement is nothing more than civil disobedience to a bad set of laws. Lets renegotiate them.

Check out my crappy creations

435.7.2006 12:13

Don't buy their cheap dvd burners the DW-Q30A they don't burn movies right They burn but they all have LEGOS in them !

445.7.2006 12:48

Nintendo Wii?............Don't make me laugh!!!!!! Mark my words!!......The Wii is the virtual boy 2!!! And anyone with half a brain knows what happened to the virtual boy.

455.7.2006 13:16

vgaddict8 UUmmmm no,qauilty will always kill eye candy and quantiny,the WII is currently the system to get for me,might put off gettign the new zelda game and wait till Metroind prime 3 rools out,it shall kicks halos ass :P *L*

Copyright infringement is nothing more than civil disobedience to a bad set of laws. Lets renegotiate them.

Check out my crappy creations

467.7.2006 13:09

Sony is no different than any otherlarge company that wants to run the world......They are against their copyright infrigemnt but wasn't it not to long ago that they, along with BMI got caught selling someone elses music..???? It is a "Do as I say, not as I do"

4711.7.2006 7:06

ZIppyDSM you're right, the wii is currently the way to go. Cheap, small, fast, and hopefully fun, with no crappy games. anyone who thinks differently, just look at the games that are produced for the PS2. Most of them are mediocre at best. As for the gamecube, I have 20 games, I love all but one. The PS2, I have bought so many games, and after 20 hours, traded them in for something else. Anyone who is willing to pay $600 US, for a glorified computer, that will most likely continue the trend of mediocre games, be my guest. In fact, Sony is counting on you.

4812.7.2006 13:12

You get what you pay for...... If your going to buy a PS3, you are going to get the fastest computer on the market that comes w/: Bluetooth (Very Big), Internal Blue Ray (This by itself cost almost as much as the PS3), Linux (The possiblities are endless), BACKWARDS COMBATIBILTY, and the list goes on. With that being said, Sony is just going to give free online play unlike XBOX 360. All in all, Sony is actually losing somewhere around $300 per PS3 that they sell. I suggest all of the XBOX supporters do your research on Linux. Linux is way more supported by programmers and communities around the world and IS MORE STABLE! Further more, why support Bill Gates? PEACE!

4912.7.2006 13:23

Xbox users already know about Linux so what's your point ? . How do you think we apply Softmods

5012.7.2006 13:47

DO THEY KNOW ABOUT LINUX? My point is PS3 w/Linux is going to dig XBOX 360 grave. I guarantee you they will have an emulator on PS3’s Linux were you can put in a XBOX 360 games/ and or .iso and play them with in the 24 hours the PS3 is released. Remember when the PSP came out…… When you invest in a PS3, you won’t have to worry about your unit over heating like the XBOX 360. MARK MY WORDS, PS3 will make the XBOX 360 look like it swings from trees. PEACE!

5112.7.2006 14:54

kearney TO ture the Wii is it for msot gamers,fanboys and hme theater buffs will get a PS3 regaurdless of what others say. the PS2 is a good all around system however the medicore games can waer on you,I ahve no dout in time the PS3 willb e the same altho it has alot more to go thru to get there..... i_t_Xpert Unless you have 700 to kill on day one most are better off to wiat untill the PS3 gains some of its...mmm hidden poteninal untill then its over priced for what 1 or 2 great games with the rest beign the best coperate devs can think up...price vrs cost I would rather wait and spend 300-400 on a medicore next gen system and I am not talking about the 360 either *L* the 360 is not bad but not worth the current price the same can be said about the PS3 unless you have alot of money or a fanboy,altho unlike the 360 it has a ton of poteninal I knw the modding comuinty can do soemthign with it but will the corpate side amke thigns more annoying or go status quo and make the next geration of sub par eye candy games....what good is the PS3 if most titles in the frist year suck?

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