Kim Dae-ji, Commissioner of the National Tax Service, Targets Multinational Corporations in First Planned Investigation

Tax Investigation on 43 Suspects of Offshore Tax Evasion and National Wealth Outflow Including Luxury Online Platforms

Kim Dae-ji, Commissioner of the National Tax Service

[Asia Economy Reporter Kwangho Lee] Since his inauguration, Kim Dae-ji, Commissioner of the National Tax Service, has targeted multinational corporations such as online platforms and overseas luxury goods industries that have transferred massive income earned domestically abroad without proper tax payments as his first planned investigation.

On the 27th, the National Tax Service announced that it has launched a tax investigation into 43 suspects accused of offshore tax evasion causing national wealth outflow.

The investigation targets include: ▲7 suspects who concealed financial assets in secret accounts opened in regions such as Switzerland and Hong Kong, where access to financial information was difficult, to evade taxes ▲6 wealthy individuals suspected of disguising themselves or their families as non-residents through methods such as nationality shopping and artificially manipulating domestic stay days to avoid tax obligations by means of irregular gifting and income evasion ▲9 business operators suspected of embezzling corporate funds using overseas local corporations or owner-owned overseas paper companies ▲and 21 multinational corporations suspected of earning massive income recently in Korea due to the expansion of the untact economy but transferring income abroad without paying proper taxes.

Considering the difficult economic conditions caused by the novel coronavirus disease (COVID-19), the National Tax Service plans to significantly reduce the total number of investigations but will strictly respond to antisocial offshore tax evasion.

In particular, this investigation will thoroughly verify not only the offshore tax evasion suspects themselves but also their families and related corporations suspected of evasion by actively utilizing domestic and international information networks. If intentional tax evasion acts such as drafting double contracts or using nominee accounts are confirmed during the investigation, a maximum surcharge of 60% will be imposed, and strict measures such as prosecution will be taken.

Earlier, on the 21st, Commissioner Kim Dae-ji stated in his inaugural speech, "We will strictly respond with a zero-tolerance policy to tax evasion that harms people's livelihoods taking advantage of national crises, antisocial offshore tax evasion, and strengthen management of new tax sources including online platform transactions."

Regarding the briefing on this day, Commissioner Kim emphasized, "We will thoroughly manage to ensure that the principle of 'Pay your fair share of tax' on income earned domestically by multinational corporations engaging in tax avoidance is strictly observed."