[Guest Report] Shin & Kim revamps ‘Tax Group’

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[Guest Report] Shin & Kim revamps ‘Tax Group’


Law firm Shin & Kim has revamped its existing tax team to offer both domestic & international clients strengthened services. [SHIN & KIM]

For the first time in history, Korea’s government budget is expected to exceed 600 trillion won ($495.87 billion) by 2023, largely due to the government’s expansionary fiscal policy. However, the national debt is expected to increase from 740 trillion won in 2019 to 1,061 trillion won in 2023, as tax revenues will fall short of expenditures. As a result, the burden on taxpayers - including corporations - will further increase. To put it another way, tax revenue hikes seem inevitable, considering the Korean government’s actions to address the issue of an aging society, its expansionary social welfare policies and continued attempts to close the gap between the rich and the poor.

A deep understanding of practical impact

To better assist corporate and individual taxpayers as they face these increased challenges, Shin & Kim, a top Korean law firm, has reorganized its existing tax team to form an expanded and strengthened set of tax - and customs-related services under one umbrella. Navigating the evolving tax environment requires a deep understanding of the actual impact on multinational corporations - both domestic and foreign - and investors, which in turn enables clients to make informed decisions.

Launched on July 1, 2019, Shin & Kim’s Tax Group provides tax advice on corporate reorganizations and mergers & acquisitions (M&A), tax policy, tax audit & investigation, dispute resolution, trust & estates, wealth management, tax planning and customs.

The group is being led by four seasoned veterans. Top litigator and former high-ranking judge with more than 32 years of experience, Hee-Chan Byun, is heading up the newly formed “Tax Group.” He has also served as legal counsel to the Korean government, including the National Tax Service of Korea (NTS). Choon Cho, who has advised on some of Korea’s most significant tax cases for nearly 30 years, is leading the Tax Disputes team within the group. Meanwhile, Hyeon-Jin Kim, a dually-licensed lawyer and certified public accountant (CPA) with over 25 years of public and private sector experience, will lead the Tax Advisory & Audit team. In addition, Do-Hoon Woo, who is also a licensed lawyer and CPA with over 10 years of experience, will lead the Customs team within Shin & Kim’s Tax Group. Together, they have already recruited some of Korea’s top tax and customs professionals, including over 30 professions ranging from lawyers, CPAs, tax accountants, customs brokers and former government officials to work together to create customized solutions for the firm’s growing Korean and international clients.

Successful representation

Shin & Kim has a strong track record of successfully handling large tax litigation cases and high-stakes appeals. Notably, Shin & Kim represented Korail in its landmark appeal of a corporate tax relating to the Yongsan Development Project in Seoul, amounting to approximately 1 trillion won - the largest tax litigation in Korean history.

Furthermore, Shin & Kim has successfully persuaded the Korean Supreme Court in a number of cases where no precedent had yet been established. For example, earlier this year, Shin & Kim’s tax professionals were able to secure a favorable ruling from Korea’s highest court, who ruled against the infrastructure-related acquisition tax, which the city of Seoul had imposed on a majority of the reconstruction associations.

Careful planning, preparation and compliance

In particular, for corporate taxpayers, good preparation and a pre-diagnosis for tax audits/investigations are key to a successful defense. Often, it is hard to predict the timing of a tax audit or an investigation. In fact, on many occasions, the actions taken by Korean tax authorities are not necessarily caused by fundamental tax reasons alone, but are often linked to social and political issues, which can lead to heavy taxes and even a violation of tax laws. Ultimately, these consequences could have detrimental effects on corporations, including financial, regulatory and reputational damage.

It is important to construct an internal risk and control system to warn against such penalty taxes and resource inefficiencies.

Unlike the past, many corporations are showing greater interest in tax and accounting issues, including effective compliance measures. While undertaking such initiatives, fundamental tax issues should be thoroughly analyzed from all related aspects during the pre-diagnosis stage.

BY KIM SEUNG-JUN [kim.seungjun@joongang.co.kr]
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