South Korean Province Recovers $4.6M in Back Taxes Using Crypto Tracking System
The South Korean province of Gyeonggi has implemented an innovative system to identify tax evaders who hide their wealth in cryptocurrency. This new approach has already retrieved $4.6 million in owed taxes from a single group of delinquents. Previously, the process of identifying and seizing crypto assets from tax evaders was slow and time-consuming, taking up to six months per case. However, a newly developed electronic management system has reduced this timeframe to just 15 days.
How Does the System Work?
- Authorities input a list of delinquent taxpayers into the system.
- The system uses resident registration numbers to track mobile phone numbers associated with these individuals.
- This significantly increases the success rate of finding tax evaders registered on cryptocurrency exchanges.
Over 5,000 Tax Evaders Found Holding Crypto
The enhanced tracking system has led to the discovery of 5,910 tax evaders who hold virtual assets like Bitcoin. These individuals owe a combined total of $3.5 million in taxes. Through the streamlined system, officials have collected an impressive $4.6 million in back taxes from over 2,300 individuals within just one year.
Noh Seung-ho, head of the Provincial Tax Justice Department, emphasized their commitment to protecting honest taxpayers and ensuring fair taxation through these innovative measures.
Cooperation with Crypto Exchanges and Postponement of Taxation
The province is strengthening its efforts by collaborating with crypto exchanges and considering administrative actions against those that resist data inquiries. Additionally:
- The ruling People Power Party in South Korea is advocating for a two-year postponement of taxation on gains from cryptocurrency investments.
- This move may be a potential campaign promise for the upcoming general election in April.
Hot Take: South Korean Province Makes Strides in Crypto Tax Enforcement
The South Korean province of Gyeonggi has revolutionized tax enforcement by implementing a crypto tracking system. With this innovative approach, authorities have successfully identified and collected back taxes from thousands of tax evaders who held virtual assets. By leveraging resident registration numbers and mobile phone tracking, the system has significantly expedited the process, reducing it to just 15 days per case. This achievement highlights the province’s dedication to fair taxation and protecting honest taxpayers. Moreover, with plans to strengthen cooperation with crypto exchanges and postpone taxation on crypto gains, South Korea continues to make strides in regulating the cryptocurrency industry.
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