US Representative Matt Gaetz Introduces Bill to Allow Federal Tax Payments in Bitcoin

South Korean Gyeonggi Province Implementing Digital Tracking System to Address Tax Cheats

As investors seek to explore new ways to evade paying taxes, the South Korean authorities have stepped up their game to address this menace. In a February 22 update, the Gyeonggi Provincial Tax Justice Department recovered approximately 6.2 billion won, translating to $4.6 million from the tax evaders.

The efforts to curb tax cheats in South Korea’s most populated region, Gyeonggi, were enabled by a newly launched digital tracking system that was implemented last year.

Rise of Tax Evasion

During the launch of the new tax system, the regulators confirmed that the new device would thoroughly assess the crypto accounts of the investors suspected of failing to remit the annual taxes.

A report from the Yonhap News Agency demonstrated that the officials at the Gyeonggi tax department extracted vital information concerning the suspect from the resident registration data.

The local news outlet explained that the data mined from the resident registration report included the mobile phone numbers, addresses, and emails that could be used in creating crypto accounts. Besides the data extraction process, the tax regulators leveraged a digital tracking system to identify delinquencies in tax reporting.

The implementation of the tax tracking device came after the local crypto exchanges failed to disclose critical information about tax evaders. In an earlier report, the tax regulator in South Korea requested information concerning a non compliant crypto investor on a case-by-case basis.

Features of Digital Tracking System

In response to the request, the local exchanges gathered information and documents required by the authority. The report indicates that extracting the data needed was lengthy and could take around six months to mine substantial details.

Due to the complexity of gathering information, the Gyeonggi province invested in acquiring a digital data management system to support the authority in addressing tax evasion.

Compared to the complicated process of obtaining data from the crypto exchanges, the Gyeonggi official noted that the new digital management tool reduced the data processing period to a maximum of 15 days.

South Korean Authority Seeks to Address Tax Evasion

A report from the tax department demonstrated that after analyzing multiple crypto transactions using the new tax tracking device, around 5910 individuals engaged in tax cheating.

Out of the 5910 tax evaders, the department collected $4.6 million from 2390 individuals. Currently the department seeks to collaborate with local exchanges to amend the existing administrative measures.

The tax authority argued that the gap in tax regulation stemmed from lack of cooperation from the local exchanges. An announcement conveyed by the head of the provisional tax justice department, Noh Seung-ho, revealed that the authority will implement a collaborative approach to apprehend the tax evaders.

The executive noted that some investors claimed to lack adequate funds to pay their taxes. The launching of the new tracking system aligns with the ongoing initiative to combat illicit transfer of funds through crypto exchanges.

Measures to Address Tax Evasion

A few days ago, the South Korean Financial Intelligence Unit (FIU) urged the local exchange to report suspicious transactions identified on the platform. The FIU publication demonstrated that the reported transfer of illicit funds via crypto exchanges surged nearly 90% in 2023.

The sudden increase in crypto-related crimes encouraged the FIU to collaborate with key industry players to launch education and training programs. Apart from this, the financial regulators plan to launch a unique digital asset analysis tool that will be used to track and monitor the movement of funds.

The new system will monitor and report suspicious transactions. Similarly, the agency plans to develop a preemptive trading suspension system that identifies suspicious transactions on local exchanges. In the report, the FIU team regretted that over 16076 cases were reported in 2023.

The increase in crypto crimes forced the regulators to take corrective steps to protect the customers from exploitation. In February, the South Korean authorities revised the Virtual Asset Users Protection Act to enforce disciplinary action against criminals. The amended rule will subject criminals generating nearly $3.8 million of illicit funds from crypto investments to life imprisonment.

All trademarks, logos, and images displayed on this site belong to their respective owners and have been utilized under the Fair Use Act. The materials on this site should not be interpreted as financial advice. When we incorporate content from other sites, we ensure each author receives proper attribution by providing a link to the original content. This site might maintain financial affiliations with a selection of the brands and firms mentioned herein. As a result, we may receive compensation if our readers opt to click on these links within our content and subsequently register for the products or services on offer. However, we neither represent nor endorse these services, brands, or companies. Therefore, any disputes that may arise with the mentioned brands or companies need to be directly addressed with the respective parties involved. We urge our readers to exercise their own judgement when clicking on links within our content and ultimately signing up for any products or services. The responsibility lies solely with them. Please read our full disclaimer and terms of use policy here.

Leave a Reply

Your email address will not be published. Required fields are marked *