South Korean Authorities Collect Over 62 Billion Won from Crypto Tax Evaders

In a major breakthrough, authorities in Gyeonggi Province, South Korea, have successfully used an advanced electronic management system to track down and collect outstanding taxes from crypto tax evaders. As political parties tout their crypto plans, discover how a whopping 62 billion KRW in tax evasion was reclaimed.

Streamlining Tax Enforcement

Gyeonggi Province’s electronic management system is transforming how tax evasion related to virtual assets is tackled. Inputting delinquents’ info triggers an automated process, cutting the procedural time to just 15 days, compared to the previous six-month ordeal with official documents.

A regional tax official shared more information.

“This electronic system has enabled us to identify nearly 5,910 individuals who owe more than 300,000 KRW in local taxes and hold virtual asset accounts, resulting in the successful collection of 62 billion KRW in outstanding taxes in the past year.”

No Tax Evasion, Says Authorities

Local authorities leveraged the system to cross-reference delinquent taxpayers‘ resident registration numbers with their mobile phone numbers. This data-driven approach allowed the officials to track individuals and substantially increase the success rate of identifying cryptocurrency holders through local exchanges.

Also Read: South Korea Eyes Bold Crypto Plan with Bitcoin ETFs, IEOs, and Tax Deferrals

This electronic system marks a big step forward in combating tax evasion in the country’s crypto market, making investigations faster and enabling efficient measures like asset seizure and liquidation.

Political Promises

As South Korea gears up for national elections on April 10, both the People Power Party and the Democratic Party are making crypto-related promises.

The People Power Party has outlined several poll promises, aiming to introduce spot Bitcoin exchange-traded funds (ETFs) and establish a ‘digital asset promotion committee.’ Moreover, the party commits to proposing laws and sanctions, prioritizing a regulatory framework before implementing a cryptocurrency gains tax scheduled for January 2025. This proposal could potentially delay the tax implementation until 2027.

“I think there is a need for at least a two-year delay until the amendment is passed and such a system is actually built.”

Member of the party

Read More: South Korea Crypto Regulation: All You Need to Know About the ‘2024 Work Plan’

Awaited Proposal

On the opposing front, the Democratic Party is yet to release its proposal, which includes allowing investors to purchase spot Bitcoin ETFs. On the other hand, South Korean national, the infamous Do Kwon has been ordered to be extradited to the US following his 8 criminal charges on fraud on the TerraUSD and LUNA crash back in 2021.