85% of High-Amount Habitual Tax Delinquents Omit Their Names Without Paying Taxes

[Asia Economy Reporter Kwangho Lee] It has been revealed that most of the high-amount habitual tax delinquents whose names were publicly disclosed disappear from the list due to the statute of limitations without paying the overdue taxes.

On the 5th, an analysis of data submitted by the National Tax Service to Kim Kyung-hyup, a member of the National Assembly's Planning and Finance Committee from the Democratic Party of Korea, showed that among the 14,310 people removed from the list in the past four years, 12,230 (85.5%) were deleted from the list without paying the overdue taxes because the statute of limitations had been completed.

The National Tax Service operates the "High-Amount Habitual Tax Delinquent Public Disclosure System," which publicly discloses the names (or business names), addresses, and overdue amounts of habitual tax delinquents with national taxes overdue by 200 million KRW or more for over one year from the date of occurrence, on the National Tax Service website or the bulletin boards of the relevant tax offices, in accordance with the Framework Act on National Taxes.

However, under current law, even if taxes are not paid, the statute of limitations of 5 to 10 years (for amounts over 500 million KRW) can be completed, or if 30% or more of the overdue amount is paid or the overdue amount is reduced to below the disclosure threshold of 200 million KRW, the individual can be excluded from the public disclosure list. Most high-amount delinquents exploit this to deliberately avoid paying overdue taxes while hiding their assets.

There were also 878 individuals who paid just enough to reduce their overdue amount below 200 million KRW, and all of them were removed from the list.

As of 2019, the cumulative number of high-amount habitual tax delinquents publicly disclosed was 56,085, with overdue amounts reaching 51.1 trillion KRW, but the collection performance was only about 3.1% (1.6 trillion KRW).

In particular, 4,914 individuals residing in the Gangnam 3 districts (Gangnam-gu, Songpa-gu, Seocho-gu) were publicly disclosed, with overdue amounts totaling 6.7 trillion KRW, which accounts for 40% of Seoul's total overdue amount of 16 trillion KRW. However, most of these individuals hide their assets and enjoy luxurious lifestyles in high-priced homes, undermining the tax-paying will of the majority of honest taxpayers and causing frustration.

Representative Kim said, "We must strengthen follow-up investigations on these individuals and devise effective measures such as stronger penalties than the current sanctions to respond strictly."

This content was produced with the assistance of AI translation services.