Searching Delinquent Taxpayers’ Homes Uncovers Luxury Liquor, Designer Goods, and Bundles of Cash... Even Sham Divorces to Evade Taxes

National Tax Service and Korea Customs Service Conduct First Joint Operation Targeting Major and Malicious Delinquent Taxpayers
Key Information on Concealed Assets Shared and Analyzed to Identify Search Targets
Assets Worth 1.3 Billion Won Seized, Including 1 Billion Won in Cash and Checks and Designer Bags

Mr. A, who runs a business manufacturing molds and automotive parts, evaded payment of several hundred million won in national taxes and customs duties, including value-added tax and corporate tax, over a long period. The National Tax Service confirmed through a lifestyle inspection that Mr. A was actually living in the large apartment (58 pyeong) owned by his divorced spouse. Suspecting a sham divorce to evade compulsory collection, Mr. A was selected as a target for a joint search operation.

When the joint search team arrived at Mr. A’s residence, his ex-spouse, who was inside the house, refused to open the door. Ultimately, the search team attempted a forced entry with the police, prompting the ex-spouse to let them in. During the search, the team found and seized over 10 bottles of luxury liquor displayed in the living room, cash assets amounting to 90 million won in a personal safe, gold rings, designer belts, and other items, totaling 26 million won worth in seized property.

Luxury whiskey and foreign currency seized at the home of the delinquent taxpayer's ex-wife by a joint search team from the National Tax Service and the Korea Customs Service. National Tax Service

Recently, the National Tax Service and Korea Customs Service carried out their first joint search targeting major and habitual delinquent taxpayers suspected of asset concealment. They seized concealed assets worth a total of 1.3 billion won, including around 1 billion won in cash and checks and designer bags.

An official from the National Tax Service explained, "This joint search operation was implemented to effectively respond to major and malicious delinquent taxpayers, in line with the government’s emphasis on inter-agency collaboration. By closely linking both agencies’ capabilities for tracking delinquent payments and information on concealed assets, we targeted individuals who owe both national and customs taxes, have the ability to pay but deliberately evade tax payments, and still enjoy a luxurious lifestyle."

To identify targets for the search, both agencies exchanged key information on actual asset concealment, evidence of a lavish lifestyle, analysis of actual residency, and data on registered addresses tied to import/export codes. Then, each local tax office and customs office conducted in-depth analysis of these data, determining final search targets and sites through stakeouts and field inquiries. Ultimately, eight joint search teams, each comprised of around ten people, were organized according to the jurisdiction of the defaulters and began the operation.

Through this joint search, the National Tax Service and Korea Customs Service found and confiscated bundles of cash and checks hidden in suitcases and high-value promissory notes. Delinquent taxpayer B, an e-cigarette trader, had falsely reported raw materials during imports, resulting in tens of billions of won in individual consumption tax assessments, as well as millions of won in national taxes due to underreported sales revenue. To avoid paying taxes, B continued running the business under his father’s name and became a target of the joint search. When B's mother refused to open the door, the search team forcibly entered with the police. In the master bedroom, they found a travel bag and requested it be opened, but after a refusal, seized it on the spot. Forced open, it was found to contain 540 million won in cash and 480 million won in checks, totaling 1.02 billion won, which was confiscated.

A joint investigation team from the National Tax Service and the Korea Customs Service seized a suitcase from a delinquent taxpayer's house. Inside the suitcase were hidden cash amounting to 540 million won and checks totaling 480 million won, for a total of 1.02 billion won. National Tax Service

Delinquent taxpayer C failed to pay millions of won in national and customs taxes, including additional income tax due to underreporting of insurance sales income and capital gains tax from unreported land sales. Despite earning significant income, C lived a lavish lifestyle without paying taxes, making 127 overseas trips over the past five years. Consequently, the search was conducted at C's registered address, resulting in the on-site seizure of five designer bags, one designer bracelet, and eight watches hidden inside luggage.

Based on these results, the National Tax Service and Korea Customs Service plan to institutionalize regular information exchanges on hidden assets and lifestyles of those who owe both national and customs taxes and continue joint enforcement actions.

An official from the National Tax Service stated, "This outcome demonstrates that inter-ministerial cooperation is an effective sanction against major and malicious delinquent taxpayers who claim business difficulties as an excuse for living in luxury. Public reporting is crucial for tracking hidden assets of habitual or large-sum delinquent taxpayers. We encourage active reporting by referring to the lists of such taxpayers disclosed on each agency’s website."

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