They also pressed charges of "aggravated breach of trust" over a complex alleged scheme in which Ghosn is said to have tried to transfer losses on foreign exchange contracts to Nissan's books.
Carlos Ghosn's chances of getting out of jail anytime soon took a serious blow on Friday after he was indicted for a second time by Japanese prosecutors building their case against the fallen vehicle executive, who was detained nearly two months ago.
Including the latest charge, a total of over ¥9.1 billion in Ghosn's pay was allegedly understated in eight years.
Previous high-profile cases involving accusations of business misconduct in Japan suggest a defendant denying allegations is unlikely to be released on bail by a court.
Prosecutors on Friday slapped the 64-year-old with a formal charge of under-declaring his income by around four billion yen ($37 million) over three years from 2015.
Ghosn, who is reportedly suffering from a fever at his Tokyo detention centre, denies any wrongdoing, arguing in a dramatic court appearance on Tuesday that he is being "wrongly accused and unfairly detained".
Ghosn's defense lawyers said they will still seek his release on bail despite the new charges.
It's not uncommon in Japan for suspects to endure lengthy pre-trial detentions.
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Ghosn, who holds Brazilian, French and Lebanese citizenship, has been kept at the Tokyo Detention House facility since his arrest on November 19. Nissan has dismissed Kelly from his role as a representative director.
Ghosn holds French, Lebanese and Brazilian passports and his children live in the USA, his wife said that her husband is living in "harsh conditions" and enduring "unfair treatment", and that authorities have not let the family speak with medical personnel at the detention center.
Ghosn's lawyer said earlier this week that his client would likely be held until the trial which could begin in about six months.
As chairman of Nissan, Renault SA and Mitsubishi Motors Corp 7211.T , the globe-trotting Ghosn had access to a string of residences around the world, including additional homes in Beirut and Rio de Janeiro.
Ghosn's former aide and Nissan director Greg Kelly - arrested the same day as the auto industry icon - was released from jail last month and taken to a hospital afterwards, Kyodo News reported earlier.
Ghosn has admitted that the ownership of the contract was temporarily transferred from his private asset management firm to Nissan but said the automaker incurred no losses.
The boards of the two companies met Thursday for an update on the investigations, and Nissan later said in a statement that it remains committed to the alliance.
"As I have repeatedly and recently made clear to the company, I look forward to continuing to assist Nissan in its investigations".
The Japanese automaker filed the complaint "on the basis of Ghosn's misuse of a significant amount of the company's funds".