Japanese tax firm Hongo Tsuji Tax Co has
merged with BDO Japan’s tax practice adding 16 offices and 390
staff to BDO’s tax operation.
The merged entity will trade under the name
BDO Tax Co and work alongside BDO Japan KK, BDO’s audit firm in
Japan. Under Japanese law, audit and non-audit businesses need to
be split.
The addition means BDO now has 1,000 staff and
is predicted to earn revenues of ¥12bn
(€156m) in fiscal 2012.
BDO is now comfortably the fifth largest firm
in Japan behind PwC, which earned ¥58.3bn in the
year to 30 June 2010. Grant Thornton, placed sixth, earned revenue
of ¥6.15bn in fiscal 2010 and BDO’s closest rival.
Managing partner Yoshihiro Hongo said he
believes BDO Tax Co will become the third or fourth largest tax
firm in the country within the next three years.
“Our larger competitors have only 4% of the
tax market share in Japan, so the potential to grow is
significant,” Hongo said.
“Joining BDO will enable us to grow our market
share and we’re already seeing some of the larger firms going
through significant downsizing, due to their large exposure to
international referral clients which are off-shoring or
centralising tax services in lower cost countries such as Malaysia
and Singapore.”
