South Korea investigates 50 firms over 1.9 trillion won tax evasion

The South Korean National Tax Service has launched tax investigations into 50 companies suspected of tax evasion through the misuse of high-priced corporate housing, often referred to as ‘emperor residences.’ The total suspected evasion amount is approximately 1.9 trillion won.

The investigation targets various types of misuse, including 28 cases of residential use by owners' families, 17 cases of luxury villas used as private retreats, and 5 cases involving real estate speculation. The group under scrutiny includes five large conglomerates and six listed companies on the KOSPI and KOSDAQ.

Specific allegations include companies purchasing luxury properties in Seoul for the private use of owners' families, paying for massive renovations with corporate funds, and providing free housing to avoid personal tax burdens. In some instances, companies allegedly used fake labor costs or inflated maintenance fees to funnel corporate funds to family members. The National Tax Service plans to use digital forensics and account inquiries to track the outflow of corporate funds and will take legal action against those found violating tax laws.