NTS says tax cheats won’t stop
Published: 15 Jun. 2016, 20:55
In another case, a businessman provided financial assistance to his son by buying shares of his son’s overseas company through his Hong Kong office. To reduce any capital gain tax he may have to pay later, he and the company drew up a separate contract that misstated the amount he paid for the shares.
These were just two of 36 offshore tax evasion cases the National Tax Agency started investigating this month. The NTS said Wednesday that these cases occurred despite the fact that the agency warned Koreans to report earnings made and properties owned overseas by March.
Some of the 36 cases were mentioned in the Panama Papers investigation by the International Consortium of Investigative Journalists earlier this year.
“There are roughly three or four [Panama Papers cases] being investigated,” said Han Seung-hee, an official at the agency’s investigation bureau.
The Panama Papers cites about 190 companies and individuals suspected of dodging taxes in Korea. Earlier the NTS investigated six or seven of those people and companies.
The Panama Papers investigation released in April was based on 11.5 million leaked documents from the Panamanian law firm Mossack Fonesca. It exposed businesses dealings of high-profile politicians including British Prime Minister David Cameron and Iceland Prime Minister Sigmundur Davio Gunnlaugsson, who had to resign as a result of the revelations. Also mentioned were celebrities such as Jackie Chan and soccer star Lionel Messi.
One of the high-profile Korean individuals mentioned in the papers was former President Roh Tae-woo’s eldest son Roh Jae-heon. The NTS did not confirm whether he is included in the 36 cases it is looking into.
Meanwhile, the NTS said that in 30 cases of tax evasion it has been investigating since January, it has concluded 25 cases and levied fines amounting to 271.7 billion won ($231.5 million). 10 of the cases in which the tax evasion was considered intentional were turned over to the prosecutors’ office as criminal cases.
The agency said it will be harder for tax evaders to hide earnings or properties overseas next year when a multinational agreement on exchanging financial information will kick off. The NTS will have better access not only to income data but also to financial transaction. Additionally it said it will pay rewards of up to maximum 3 billion won to people who provide vital information to tax dodging investigations.
BY LEE HO-JEONG [lee.hojeong@joongang.co.kr]
with the Korea JoongAng Daily
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