Japan's Potter translator may face back taxes

TOKYO, June 12 (Reuters) Harry Potter's Japanese translator could use a little magic in her dispute with tax authorities.

Yuko Matsuoka, who has translated and published the global best sellers, has been feuding with Japanese tax officials over nearly million in income they say she failed to declare.

Matsuoka, 63, has said she is a resident of Switzerland, but Kyodo news agency said today that authorities in Japan and Switzerland had determined that she effectively lived in Japan through 2005, quoting sources close to the case.

Japanese tax officials want her to pay more than 700 million yen in back taxes on 3.5 billion yen of undeclared income for three years up to 2004 because she was involved in publishing in Japan and frequently spent time there, Kyodo said.

Matsuoka could also face back taxes for 2005, Kyodo added.

Japanese tax officials declined to comment, as did Matsuoka's Tokyo publishing house Say-zan-sha Publications.

Matsuoka was quoted as saying in a statement that her ''good faith'' had been recognised by authorities in both nations.

''My mission and joy in life is to bring the fantasy of the Harry Potter series to many millions of young readers in Japan, not to encourage fantasy by commenting on such sensationalist figures,'' Kyodo quoted her as saying.

Matsuoka beat Japan's big publishing houses to win translation rights for the Harry Potter books after reading the first book through the night. Her feat transformed Say-zan-sha Publications, which her late husband founded, from a struggling publisher run out of her apartment into a full-fledged company.

The fifth ''Harry Potter'' film will premiere in Japan later this month.

REUTERS SG RK0844