Luna·Terra's Kwon Do-hyung Explains 'Tax Evasion Allegations'..."Korean Government Collected Taxes for COVID Fiscal Spending"

Kwon Do-hyung, CEO of Terraform Labs [Photo by Yahoo Finance YouTube capture]

[Asia Economy Reporter Hwang Sumi] Kwon Do-hyung, CEO of Terraform Labs, which caused the crash of Korean virtual currencies Luna and TerraUSD (UST), denied allegations of tax evasion raised by some.

On the 21st (local time), CEO Kwon stated on his Twitter that Terraform Labs underwent a tax audit by the Korean National Tax Service and fully paid the additional taxes assessed, asserting that there are no unpaid taxes owed to Korea.

He also claimed that the tax assessment by the National Tax Service at that time was unjust. His argument is that the Korean government excessively taxed virtual currency companies, charging millions of dollars to cover COVID-19 fiscal expenditures.

CEO Kwon emphasized, "We paid our full share." He added, "We are willing to respond to any lawsuits or regulatory investigations to the best of our ability," and "We have nothing to hide."

This appears to be a response to questions surrounding the tax evasion allegations raised by some netizens. Previously, a netizen presumed to be a Terra investor asked CEO Kwon, "Aren't you being chased by Korean tax authorities for over $78 million in unpaid corporate taxes?"

There were also claims that Singapore, where Terraform Labs’ headquarters are located, has low corporate tax and no capital gains tax. In response, CEO Kwon explained, "The National Tax Service conducted tax audits on all major virtual currency businesses of the Korean corporation and applied Korean tax laws to the overseas parent company (Terraform Labs’ Singapore headquarters)." He continued, "In conclusion, all companies under Terraform Labs have paid their taxes," emphasizing, "We paid in full."

Regarding suspicions that Terraform Labs dissolved its Korean corporation just before the Luna and UST crash, he clarified, "It simply took time to close the Korean corporation, and the timing was coincidental." He added, "We no longer have a Korean subsidiary," and "Terraform Labs headquarters was established in Singapore and is still operating in good condition."

Meanwhile, CEO Kwon has been accused and sued over allegations of a Ponzi scheme (multi-level financial fraud) related to the Luna and UST crash. According to the Seoul Southern District Prosecutors’ Office on the 20th, this case is being handled by the recently revived Joint Investigation Team on Financial and Securities Crimes of the Seoul Southern District Prosecutors’ Office.

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