YouTuber with 200,000 Subscribers Caught Owing Tens of Millions of Won in Back Taxes in Gyeonggi Province

[Suwon Ilbo=Reporter Park No-hun] Gyeonggi Province has for the first time nationwide investigated hidden earnings from "individual media creator" activities of local tax delinquents and garnished the unpaid taxes.

According to Gyeonggi Province on the 13th, the province conducted an intensive investigation from April to July into the activities and earnings status of 163,147 local tax delinquents among 10 major multi-channel network (MCN) operators, identified 9 delinquents, and garnished current and future earnings for the unpaid amount of 170 million won.

Gyeonggi Province explained that as the creator industry continues to grow with the expansion of non-face-to-face services due to COVID-19, there was a need for investigation as management of local tax delinquency and hidden earnings for industry workers has not been conducted.

The investigation was premised on the fact that creators active on YouTube receive advertising contracts, goods production, and various legal support through MCN companies. Based on Article 140 of the Local Tax Basic Act (tax officials' right to question and inspect), the investigation proceeded by securing a list of approximately 5,000 creators through cooperation with MCN companies and confirming matches with the local tax delinquent management list.

In the detected cases, Creator A, who owed 3 million won in local income tax, was being managed as a person with no assets as revenue-generating activities or real estate holdings were absent, making enforcement of delinquent collection difficult. However, Gyeonggi Province directly visited Creator A's contracted MCN company to secure a list of affiliated creators, and while investigating matches with the local tax delinquent management list, discovered that Creator A had online earnings that could be monetized through creator activities. Following garnishment measures, the creator voluntarily paid.

Creator B, who owed 18 million won in local income tax, was found to be a so-called "blockbuster YouTuber" with estimated monthly advertising income of over 7 million won and over 200,000 subscribers. Future earnings receivables from creator activities were subject to advance garnishment.

Choi Won-sam, Director of Tax Justice at Gyeonggi Province, said, "As creators' influence grows, the sincerity of tax payment for asset acquisition must also increase. Going forward, Gyeonggi Province will take the lead in realizing tax justice through follow-up measures including ongoing investigations into earnings from creator activities by local tax delinquents."