Suwon Succeeds in Collecting High-Value Delinquent Local Taxes Through Precision Collection Technique

[Suwon Ilbo=Reporter Seo Dong-young] Suwon City has successfully devised a new collection technique to recover delinquent local taxes from a high-value delinquent taxpayer.

The city converted seized assets of a high-value delinquent taxpayer, for which auction procedures could not proceed, into a public auction and recovered 135 million won in delinquent local taxes, it announced on the 9th.

High-value delinquent taxpayer A failed to pay six local income taxes from September 2015 until recently and accumulated approximately 135.8 million won in total delinquency including penalty taxes.

A owned real estate inherited from his parents, but as his business became difficult, he transferred ownership of the inherited real estate to his siblings in the form of debt repayment.

The creditor, Korea Technology Finance Guarantee Fund, viewed this as a fraudulent transfer that violated creditor rights and filed a cancellation suit to restore ownership to A, then proceeded with an auction.

However, when A's siblings claimed inheritance reserved shares and filed an "immediate appeal," the auction was cancelled. Time merely passed without recovering creditor rights or delinquent taxes.

Seeking various methods to collect high-value delinquent local taxes, the city researched collection techniques and found a way to dispose of seized assets that had fallen through the blind spot of auctions by utilizing public auction procedures.

Unlike auctions, public auctions do not have an immediate appeal system. The city confirmed that only rights registered in the real estate register according to the National Tax Collection Law are recognized, and tax claims take priority.

Accordingly, the city conducted public auctions on three real estate properties restored to A's ownership starting in March of this year and was able to receive full payment of A's delinquent taxes on October 14th.

The city plans to actively inform other local governments of such delinquent tax collection cases utilizing the advantages of the public auction system for taxpayers' assets in the blind spot of auctions, so that know-how can be shared.

A city official stated, "This collection is the result of implementing precision delinquent collection techniques to pursue customized delinquent tax collection measures against high-value long-term delinquent taxpayers," and added, "We will make our utmost efforts to strengthen Suwon's sound finances and minimize delinquency."