Seongbuk-gu, Seoul, Expands Virtual Asset Seizures for Tax Collection
Seizure Threshold Lowered to 500,000 Won
Broader Targets... Blocking Tax Evasion
#Mr. A, a resident of Seongbuk-gu, Seoul, had managed to avoid paying 21 million won in property taxes and other dues across 20 cases for 10 years since 2015. Earlier this year, when the Seongbuk-gu District Office seized his virtual assets and notified him of the action, he paid all his taxes within a few days. In addition, the district office was able to collect 22 million won from 14 individuals whose tax collection rights were about to expire this year (a situation where taxes can no longer be collected after a certain period following assessment) by seizing their virtual assets.
Employees of Seongbuk-gu Taxation Division 2 and 38 Tax Collection Team who strongly respond by tracking tax delinquents to the end. From the left: Yeonkyung Kang, Hyunju Lee, Jaebeom Park, Younghee Son (Head of Taxation Division 2), Youngjoo Kim, Hyunju Choi (Head of 38 Tax Collection Team), Seunga Sun. Provided by Seongbuk-gu.
Cases of local governments seizing the virtual asset accounts of habitual or intentional tax delinquents to collect taxes are drawing attention. Chronic cases where individuals hide their assets and refuse to pay taxes, despite having the means to do so, have been a persistent headache, but authorities have found a solution through the seizure of virtual assets such as Bitcoin.
Seoul’s local governments have been actively pursuing claims against virtual assets this year as part of stronger efforts to collect delinquent taxes. Among them, Seongbuk-gu seized 60 cases of delinquent virtual assets from the beginning of this year to April 15, collecting 66 million won from 40 of those cases in just over three months.
This achievement was made possible by proactive administration, specifically by lowering the seizure threshold for delinquent virtual assets to 500,000 won. Lowering the threshold increases the number of targets, allowing authorities to prevent more cases of intentional tax evasion. However, this also increases the number of seizures, resulting in more workload and a rise in complaints from delinquents, which in turn adds to the challenges faced by tax officials.
Nevertheless, Hyunju Choi, Head of the 38 Tax Collection Team at Seongbuk-gu Taxation Division 2, stated, “Most tax delinquents who hold virtual assets are not those struggling for basic living expenses, so strong claims against them are absolutely necessary. We will further expand these measures, as they are an effective means to block tax evasion attempts and meet demands for social fairness.”
Currently, Seongbuk-gu is seizing delinquent accounts at five virtual asset exchanges: Upbit, Bithumb, Korbit, Coinone, and GOPAX. Within the first half of this year, the district plans to open a corporate virtual asset account (electronic account). Once this is established, it will be possible to transfer seized virtual assets directly to the district office’s electronic account and sell them for collection, making the process even more proactive than the current method, where delinquents must prepare cash separately to pay off their tax debts in order to lift the seizure on their virtual asset accounts.
Last year, Seongbuk-gu collected 6.3 billion won in delinquent local taxes, earning the distinction of being the top district in Seoul for local tax collection and settlement performance. The 38 Tax Collection Team is actively pursuing not only standard measures such as public disclosure of names, travel bans, and real estate seizures, but also other claims including court deposits, equity securities, bank financial asset seizures, and trust asset seizures to achieve its collection targets.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
