Gyeonggi Province Uncovers High-Value Tax Delinquents with Tens of Millions of Won in Savings Bank Deposits

[Suwon Ilbo=Park No-hun Reporter] #1. Mr. A, who operates multiple commercial property rental businesses in Goyang and Paju, failed to pay 20 million won in local income taxes.

Goyang and Paju city governments repeatedly urged payment, but each time Mr. A claimed, "My business is struggling and I have no money."

However, Gyeonggi Province's comprehensive survey of savings banks discovered that Mr. A possessed approximately 30 million won in savings bank deposits and installment savings.

#2. Company B, which operates a building rental business in Anyang, failed to pay 50 million won in taxes including property taxes since 2016.

Company B had funds available but feared immediate seizure if it deposited money at a general bank.

As a workaround, Company B deposited 40 million won at a savings bank, but was detected in this Gyeonggi Province investigation and immediately subject to seizure.

High-value tax delinquents who attempted to hide their assets in savings banks to avoid bank account seizures due to tax arrears were uncovered in bulk by the Gyeonggi Province investigation.

From March through early May, Gyeonggi Province conducted a comprehensive survey of savings bank deposits and installment savings of approximately 40,000 high-value delinquents with arrears exceeding 10 million won. On the 13th, the Province announced that it detected and seized 5.6 billion won in savings assets held by 138 individuals.

Local governments operate a 'tax delinquent deposit seizure system' that allows immediate seizure of bank and other tier-one financial institution assets in cases of tax arrears, but the seizure system is underdeveloped for tier-two financial institutions such as savings banks.

In practice, the process requires considerable time and procedures, ranging from separate asset investigations to seizure.

Accordingly, the Province undertook for the first time nationwide a comprehensive survey of all 79 domestic savings banks and their branches, and plans to sequentially collect the seized assets through procedures under the Local Tax Collection Act and other legal frameworks.

Kim Min-kyung, Director of the Tax Justice Division at Gyeonggi Province, stated: "They claimed they had no money to pay tax arrears because business was difficult or they were unemployed, yet tens of millions of won in secretly deposited money was found in savings banks." He added, "Most of the delinquents detected in this investigation are chronic repeat offenders, and we will vigorously pursue tax collection through additional legal procedures."