Over Hiding Assets Overseas
The National Tax Service launched tax investigations yesterday (Dec. 6) on 37 people accused of hiding assets overseas through tax havens.
This includes well-known conglomerates and people included in the “Paradise Papers,” which were confidential information, recently leaked from a law firm located in Bermuda, a United Kingdom territory.
Kim Jong-soo has more.
The 37 people that the National Tax Service decided to launch an investigation into tax evasion have all exhibited anomalies in transactions with paper companies in tax havens or overseas corporations.
The list included some of the 232 conglomerates and well-known people exposed through the recent leak of the UK Bermuda law firm Appleby’s confidential data called the “Paradise Papers” by the ICIJ.
It was reported that the list included some large conglomerates, as well as famous people.
The most common types of overseas tax evasion is by hiding income earned overseas through paper companies in tax havens or by claiming to perform a service that was not performed and pay company funds as compensation overseas to hide the money. Another way of tax evasion is carried out through expedient transactions with fake overseas subsidiaries to omit income and such.
The National Tax Service levied over 1.1 trillion won in taxes by investigating 187 people suspected of overseas tax evasion just this year prior to this.
Company owner A claimed to have invested in a company in a third country through a paper company in the British Virgin Islands, which is a tax free country, and sold the company to hide profits, and he was levied billions of won in income taxes and was prosecuted.
Company B that hid the differences from sales prices in the Virgin Islands after declaring that the company business rights were sold for cheap to a foreign country was also levied billions of won in taxes, and its company owner was prosecuted.
The National Tax Service is planning to reinforce its investigation of offshore tax evasion with financial information from approximately 100 countries through the financial information exchange agreement between multiple countries starting this year.
Kim Jong-soo reporting for Yonhap News TV.
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