The Korea Herald

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Diagio Korea undergoes tax investigation

By Korea Herald

Published : Aug. 31, 2012 - 20:38

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The nation’s tax agency has launched a tax probe into Diagio Korea, the local unit of the world’s No.1 distiller.

The National Tax Service sent investigators to the company’s main office in Yeoksam-dong, southern Seoul on Thursday, according to industry sources.

It is not known whether the NTS’s probe is about possible tax evasion or price-fixing of the distributor of Johnny Walker and Windsor whiskies.

Yonhap News quoted an unnamed Diagio official as saying that it is a regular tax inspection as had planned before. The U.K.-based whisky importer underwent a tax investigation in 2007.

The case is drawing interest this time as the investigation followed Diagio’s recent announcement that it will raise prices of its whiskey products, including Windsor and Johnny Walker, by 5.5 percent starting Saturday.

The probe came at a time when the company is in a court battle with the Korea Customs Service over the agency’s imposition of fines amounting to about 400 billion won on charges of evading tax.

Diagio Korea marked total sales of 397.3 billion won and a net profit of 104.1 billion won last year.

(claire@heraldcorp.com)