National Tax Service, First Government Agency to Enforce Collection on Virtual Asset Property Concealing Tax Delinquents
222 Individuals Confirmed for Additional Evasion of Forced Collection... Ongoing Tracking Investigation
[Sejong=Asia Economy Reporter Kim Hyunjung] Mr. A, a professional business owner who operates a hospital in Gangnam, Seoul, and lives a luxurious life in a high-priced apartment, concealed 3.9 billion KRW by converting income into virtual assets without paying 2.7 billion KRW in overdue taxes. Upon confirming this fact, the National Tax Service seized Mr. A's virtual assets and forced full payment in cash.
Mr. B, who transferred real estate located in Gyeonggi Province for 4.8 billion KRW, did not pay 1.2 billion KRW in capital gains tax and hid 1.2 billion KRW of the transfer proceeds in virtual assets. The National Tax Service seized Mr. C's virtual assets, collected the full amount, and secured cash collection.
As the number of investors and transaction amounts in virtual assets such as Bitcoin have significantly increased, the government has forcibly collected assets hidden by tax delinquents in virtual assets for the first time.
On the 15th, the National Tax Service announced that after collecting and analyzing data on virtual asset holdings of tax delinquents from virtual asset exchanges and conducting seizures and other forced collections, it has collected or secured bonds worth approximately 36.6 billion KRW in cash from 2,416 high-value tax delinquents who concealed assets in virtual assets. The National Tax Service expects the effectiveness of forced collection to increase further due to the recent surge in virtual asset prices. In particular, among the 2,416 individuals, 222 were found to have additional allegations of evading forced collection, such as hiding real estate transfer proceeds, and are under follow-up investigation.
According to the National Tax Service, virtual assets are defined as electronic certificates that have economic value and can be electronically traded or transferred. Previously, in May 2018, the Supreme Court ruled that "virtual assets correspond to intangible property with property value subject to confiscation." Last year, through amendments to the Act on Reporting and Using Specified Financial Transaction Information, virtual asset service providers were included as financial companies and were given obligations equivalent to existing financial companies, such as reporting suspicious illegal asset transactions, reporting high-value cash transactions, and customer verification obligations.
A National Tax Service official explained, "We will continue to respond swiftly to new concealment methods such as asset concealment using virtual assets and will thoroughly track and recover hidden assets of high-value tax delinquents."
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