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Paju’s measures are part of a larger nationwide effort to curb tax evasion facilitated through digital assets.
Key Notes
South Korea's city of Paju has sent 17 individuals with unpaid tax notices to confiscate their cryptocurrencies on exchanges for tax evasion.The move follows previous seizures of about 100 million won from tax evaders in July 2024.In a bold move to combat tax evasion, authorities in Paju, a city within South Korea’s Gyeonggi Province, have announced plans to confiscate and sell off the cryptocurrency holdings of residents with outstanding tax debts.
According to a local news report Yonhap News, this aggressive approach underscores the government’s commitment to ensuring tax compliance, even as more citizens turn to digital assets as a potential shield against debt collection.
Notices Sent to 17 Tax Delinquents
Officials in Paju issued warnings to 17 individuals with unpaid taxes totaling 124 million Korean won (approximately $88,600). The city has made it clear that if these taxpayers do not settle their debts by the end of November, their digital assets held on exchanges will be seized and liquidated.
This latest action highlights an intensifying effort to track down tax evaders and enforce financial penalties. Officials in Paju stressed that their strategy serves as a clear signal that using digital assets to obscure wealth or dodge tax obligations will not be tolerated.
This is not the city’s first foray into crypto confiscation. On July 29, authorities in Paju seized 100 million won (approximately $72,000) in crypto holdings from tax defaulters. At the time, government officials revealed that many residents had intentionally converted their funds into digital assets, despite having the means to pay their tax bills, in an attempt to avoid detection.
According to city officials, this trend of using digital assets as a haven for hidden wealth has grown in popularity across South Korea. The government has responded by enhancing its ability to monitor and seize digital assets from individuals who attempt to evade their financial obligations.
A Wider Crackdown across South Korea
Paju’s measures are part of a larger nationwide effort to curb tax evasion facilitated through digital assets. In August, Seoul’s affluent Gangnam District initiated a sweeping investigation targeting nearly 2,000 residents suspected of hiding assets in cryptocurrencies.
Gangnam officials stated that they would use newly developed crypto-monitoring tools to identify and confiscate tokens from tax delinquents. The district’s crackdown is expected to conclude by the end of October.
Meanwhile, South Korea’s campaign to tackle tax evasion is complemented by technological advancements aimed at boosting transparency. On November 13, NongHyup Bank announced a collaboration with digital asset platform Fireblocks to explore tokenizing value-added tax (VAT) refunds. This pilot project, backed by Fireblocks’ tokenization engine, is designed to provide real-time tracking of assets, significantly reducing the risk of errors and fraud.
Fireblocks co-founder and CEO Michael Shaulov noted that the project aims to assign unique digital identifiers to assets, creating an immutable record from issuance to settlement. This development is expected to streamline processes, lower operational costs, and enhance trust between financial institutions and their clients.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Chimamanda is a crypto enthusiast and experienced writer focusing on the dynamic world of cryptocurrencies. She joined the industry in 2019 and has since developed an interest in the emerging economy. She combines her passion for blockchain technology with her love for travel and food, bringing a fresh and engaging perspective to her work.
