Crypto tax evasion is becoming a hot potato for the authorities in some Asian countries, such as Japan and South Korea. A South Korean city is now actively fighting against tax evaders who are suspiciously reporting meager earnings in their filings.
511 Individuals in the Authorities’ Eyes
According to Gugkje News, the authorities of Gyeongju, in North Gyeongsang Province, are aware of several possible cases of crypto tax evasion where individuals are reportedly hiding money into cryptocurrencies without reporting them before the tax authorities.
As the new “Specific Financial Information Act” rules enforced the monitoring of the crypto exchanges to combat money laundering and tax evasion, Gyeongju City and the North Gyeongsang Province are cooperating with four domestic exchanges to identify the alleged tax evaders.
In fact, Bithumb and Upbit are reportedly providing the data asked by the authorities to analyze possible irregularities.
As of press time, 511 individuals are under investigation, while 68 legal entities are part of parallel inquiries to check if they possess undeclared crypto holdings.
But this is not a special request from the watchdogs, as, by law, crypto exchanges should always report any suspicious transactions performed through their platforms. However, the city is asking for in-depth analysis in these alleged cases.
Furthermore, authorities threatened to seize “and collect” tokens from their wallets if they found irregularities and confirm the tax evasion in each individual involved in the saga.
The Gyeongbuk Province wants to verify if there is, in fact, a deficit of 10 million won ($8,970) “or more” due to the evasion. Gyeongju Mayor Joo Nak-young commented:
We are engaged in the various disposition of arrears to collect arrears for high and high-quality delinquents.
South Korea Keeps Actively Fighting Nationwide Crypto Tax Evasion
Recently, Bitcoin.com News reported that the National Tax Service of South Korea (NTS) identified 2,416 individuals who reportedly hid their assets in cryptos to bypass taxation.
Evaders allegedly used bitcoin (BTC), ethereum (ETH), ripple (XRP), among other cryptos, to avoid being scrutinized by the tax authorities.
What are your thoughts on the threat issued by the authorities in that South Korean city? Let us know in the comments section below.