Borrowed-Name Assets for Tax Evasion on the Rise Again... Surpass 610 Billion Won

From 585.7 Billion Won in 2023 to 613.4 Billion Won in 2024
Sharp Increase in Stocks and Equity Shares
"Concerns Over Abuse as Tools for Tax Evasion and Concealing Criminal Proceeds"

The scale of assets held under borrowed names to evade taxes increased last year. The value of borrowed-name assets managed by the National Tax Service surpassed 610 billion won.

According to data submitted by Assemblyman Kim Youngjin of the Democratic Party of Korea, as of the end of last year, the cumulative number of borrowed-name assets managed by the National Tax Service stood at 4,159 cases, a 6.3% increase compared to 3,911 cases in 2023. The managed amount, which had decreased from 661 billion won in 2022 to 585.7 billion won in 2023, rose again to 613.4 billion won last year, marking a 4.7% increase year-on-year.

Borrowed-name assets refer to assets such as bank accounts, stocks, and real estate acquired under someone else's name rather than one's own. Most of these are created for the purpose of tax evasion, raising concerns about significant potential for tax dodging. Since 2009, the National Tax Service has been operating the 'Borrowed-Name Asset Management Program' to monitor and manage the status of such assets after the fact.

The number of borrowed-name asset management cases decreased from 5,155 in 2020 to 3,924 in 2021 and to 3,827 in 2022, but then rose to 3,911 in 2023 and surpassed 4,000 again last year.

By category, stocks and equity shares saw a significant increase. The number of managed cases last year was 1,072, up 53.1% from 700 cases the previous year, while the managed amount also increased by 4.7%, from 421.5 billion won to 441.5 billion won.

For borrowed-name assets in savings and deposit accounts, the number of cases decreased by 3.5%, from 2,624 in 2023 to 2,532 last year, but the amount increased by 12.3%, from 87.7 billion won to 98.5 billion won. For real estate, the number of managed cases was 555 and the managed amount was 73.4 billion won, representing decreases of 5.5% and 4.1%, respectively, compared to the previous year.

Assemblyman Kim emphasized, "Borrowed-name assets can be abused as tools for tax evasion and concealing criminal proceeds," and added, "The National Tax Service must track borrowed-name assets to the end, ensure they are converted to real names, and strictly impose taxes on unjust gains in accordance with the law and principles."