As a result, reports evening tabloid Nikkan Gendai (May 10), the nation’s sex businesses are waging wars between themselves.
Taizo Ebina, a writer covering the fuzoku trade, tells the tabloid that downward pressure on pricing remains, and a policing of businesses regarding those who pay and do not pay taxes is unfolding.
“The majority of shops fear a drop in customers if they raise prices in accordance with the tax rise,” says the journalist. “So they have no choice but to dip into their profits.”
Therefore, businesses who pay taxes are becoming increasingly wary of those who do not, says Ebina.
“Much like in 1997, the last time Japan upped the consumption tax, anonymous phone calls are being placed to various authorities about businesses engaging in tax evasion or offering illegal services, such as full sex,” he says.
Though there is no evidence of such activity, tax authorities in April cited the Hot Point Group, a nationwide chain of “fashion health” establishments, for concealing income totalling 3.2 billion yen for several years through 2013.
The article says that false claims are also posted on Internet promotion sites. These may include accusations that a particular club employs women with sexually transmitted diseases or has connections with organized crime.
To compensate, shop owners can turn to advertising agencies, Ebina assures. “To make up for losses due to the tax increase, once a month shops will place ads for special parties,” he says. “Well-heeled customers will pay 20,000 yen to attend parties in VIP rooms to drink and chat one-on-one with hostesses.”
For an additional 10,000-yen payment, a customer can receive a hand-job from one of the attendants.
“If you assume attendance by 20 customers, that is an income of 400,000 yen,” says Ebina. “Subtracting appearance fees paid to the girls — 10,000 yen each — that leaves 200,000 yen to give to the tax man.”
Source: “Dorojiai made shohizai zozei ga manekuita fuzoku gyokai no jingi naki tatakai,” Nikkan Gendai (May 10)