176 individuals, reportedly including 20 celebrities, under investigation for suspected tax evasion

The National Tax Service has been delving into tax evasion (including YG Entertainment) in relation to clubs and companies recently due to the Burning Sun scandal, and they recently found 176 people to investigate on suspicion of tax evasion.

On April 10, a source from the National Tax Service revealed that a country-wide investigation has taken off to uproot tax evasion by high-income businessmen, who have been evading taxes through unconventional methods despite their huge incomes from managing new and prospering businesses. Included in the 176 people are YouTube content creators, BJs (broadcasting jockeys), managers of cloud storage companies, celebrities, athletes, medical professionals, finance and real-estate consultants, and people who did not regularly file their income tax returns after being audited. The National Tax Service was able to select these people by thoroughly searching into businesses that have either recently been put on spotlight or have insufficient tax verification comparative to their booming businesses.

The National Tax Service also discussed the different types of tax evasion they were dealing with, including citing one example that was a celebrity.

In the case of a celebrity identified as “A,” who established a one-man agency under a family member’s name, they evaded taxes by falsely wire transferring service cost to an agency employee and then retrieving it back. With the money “A” gained from tax evasion, the celebrity reportedly bought land and high-priced cars for family members, but failed to report the gift tax. Furthermore, “A” purchased their family’s shares in the one-man agency at a high price on purpose and transferred it back to the family without taking the appropriate procedure. The National Tax Service charged “A” a total fine of 3 billion won (approximately $2,633,985). An athlete identified as “C,” who works abroad, evaded taxes by failing to report about their foreign bank account, through which they receive their income. Taking the time “C” resided in Korea and their domestic wealth into consideration, “C” is identified as a resident of Korea. However, “C” still failed to report their annual salary and the fee they received from signing a contract abroad. With the addition of penalty fees, “C” was charged a total of 1.4 billion won (approximately $1,229,606).

There are reportedly 20 celebrities involved in this wide-ranging tax investigation as the scope of the blowback from Burning Sun only continues to grow.


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