Report says tax agency found evidence of illicit ‘round trips’ of funds to Switzerland
The National Tax Service has detected an illegal flow of funds in the form of roundtrip investment from private bank accounts in Switzerland, local news reports said Wednesday.
Tax authorities in Switzerland are said to have returned 5 percent of the dividend tax or 5.8 billion won ($5.3 million) on the foreign fund’s income from Korean stocks. Under the tax treaty between the two countries, Seoul authorities are subject to 15 percent of local income generated on capital from Swiss account. The collection settled the matter of tax deferred by roundtrip capital parked in Europe and bypassed here, the Yonhap news agency reported.
The NTS declined to verify the details.
The state agency launched its biggest-ever crackdown on offshore tax evasion by foreign investors and large businesses this year. Tax, customs and financial authorities set up a joint task force to better detect tax evasion in financial transactions, including borrowed-named trades to manipulate their incomes.
The NTS has been exchanging financial information with Switzerland, a traditionally popular banking destination for its tight confidentiality protection laws.
The agency slapped fines worth 2.77 trillion won ($2.49 billion) based more than 18,300 examinations conducted into individuals and businesses that tried to evade taxes last year.
The plan for this year is to concentrate more manpower and introduce new screening procedures for increased efficiency.
By Cynthia J. Kim (email@example.com