Roppongi hostess club tax evasion scandal exposes issues of nightlife workers’ taxation
What happens to all those millions of yen that flow through the coffers of Japan’s hostess clubs?
A lot goes into the pockets of the hard-working hostesses, of course, plus plenty is spent the expensive decor and upkeep of the venue.
Not very much goes to the taxman, it seems.
At the end of September 2025, a high-end hostess club in Roppongi was found to have concealed approximately ¥500 million in income. In addition to Fabric Lounge Tokyo’s owners reporting lower income and fabricating fictitious expenses, the National Tax Agency said that some of the top hostesses themselves had failed to file tax returns.
The question of taxation may seem like a dry one, especially for a website called Tokyo Kinky, but it stems from the way that the industry works, in which hostesses often treat their jobs like a side gig done at night (and many at the smaller clubs may well have regular day jobs).
“After I started working for a while, I learned about tax returns. When I wasn’t making good sales, I didn’t know anything about it. Even now, there are people around me who don’t pay their taxes,” says Yuria, a 31-year-old hostess interviewed for Maidona News.
She started working in the “water trade,” as it is euphemistically known, at the age of 21 and says she knew nothing about filing her taxes until she was 25. She had assumed that the taxes were included in the welfare expenses taken from her salary.
Yuria ended up consulting with a tax accountant who specializes in hostesses, and eventually paid five years worth of back taxes.
Another woman interviewed is 23-year-old Mayuka, who has as sex worker since 18 and has never filed taxes in that time. “I know it’s bad, but I’m leaving it alone”
“I don’t keep records of how much I earn each day. I tried to file a tax return once, but couldn’t understand it at all and just gave up. I heard that hiring a professional tax accountant is very expensive, so I still can’t afford it.”
Our image of hostesses, and perhaps of escorts, is that they are rolling in cash and expensive brand bags given to them by favorite clients. But that’s perhaps only the few who do very well.
“I think that people who are really popular because they show their face [on the brothel website], or influencer-type members of the club, are probably doing it properly. They make a lot more than me. The rest of us are generally ignored. I’ve worked at three clubs so far and I’ve never once heard them tell me that I should file a tax return.”
