South Korean authorities appear to have focused on strengthening anti-avoidance measures across the country. The country’s tax inspector profiled thousands of tax evaders who used cryptocurrencies to hide billions of Korean won in assets.
fraudsters hid $32.24 million inassets.
According to the Korea Herald, South Korea’s National Tax Service (NTS) has identified 2,416 people who allegedly hid their assets in cryptocurrency vaults to avoid taxes. The agency explained that fraudsters used Bitcoin (BTC), Ethereum (ETG), Ripple (CRP) and other cryptocurrencies to escape the scrutiny of tax authorities.
According to official figures, the tax evasion involved assets of 36.6 billion won ($32.24 million). In addition, the NTS said it mainly targets people who owe more than 10 million won ($8,800) in taxes.
Nevertheless, the tax authorities were able to recover hidden assets in the form of cash and bonds. At the same time, an investigation was opened against 222 of these alleged fraudsters. The agency issued the following statement:
This latest investigation is part of our ongoing efforts to step up the fight against anti-social tax evasion. We will capture some very smart (tax exempt) deals and quickly buy back their hidden properties.
National cryptocurrencies which interface with the NTS
The NTS said it relied on internal cryptocurrency exchanges to collect the personal data of suspected tax evaders. It contained trade reports and bank details of individuals, which is well within the strict rules that currently govern the cryptosphere in South Korea.
The law requires the South Korean cryptocurrency exchange to use a system of real names by partnering with a financial institution to provide the service.
Banks will need to conduct due diligence on cryptocurrency companies they do business with, and ensure they are properly reported to the Korea Financial Intelligence Unit (KOFIU).
Bitcoin.com News Service reported that the South Korean government has issued an amendment to impose a 20% tax on profits from cryptocurrency trading.
Although the rule went into effect in February, lawmakers clarified earlier this year that the new rule would not apply until 2022.
What do you think of the recent crackdown on tax evasion in South Korea? Let us know your comments in the section below.
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