Sources close to Tokyo's tax bureau say it has imposed back taxes amounting to about 1.8 billion yen, or 12 million dollars, on Hong Kong-based Yotta Games.

The company distributes online game Mafia City across the globe.

The sources say the Tokyo Regional Taxation Bureau asked the government of Singapore, where there is an online platform used by many overseas businesses, to present a list of companies based on a tax treaty between the two countries.

They say the audit discovered that Yotta Games did not report Japanese consumption tax on its profits from sales of online games purchased by users in Japan.

The firm's unpaid consumption tax is believed to have amounted to 1.5 billion yen in the three-year period through 2022. The back taxes of 1.8 billion yen include the penalty for the company's failure to file properly.

The sources say Yotta Games had been uncooperative with the tax audit. They say the bureau decided that it cannot expect the firm to voluntarily pay the taxes, and conducted a procedure to bring forward the payment deadline.

The authorities seized the company's assets in Japan in a procedure that took about 10 days, shorter than the usual time, after the firm failed to meet the deadline.