The government of South Korea has seized $22 million in cryptocurrencies owned by tax evaders. As part of the investigation, the National Tax Service office in Seoul has identified 1,566 individuals and company heads with overdue taxes. The regulatory agency then proceeded to seize $22 million in digital currencies held by 676 of them on three cryptocurrency exchanges.
Seoul has reportedly become the first city in South Korea to confiscate individuals for allegedly hiding their assets using cryptocurrencies.
According to a report by the Yonhap News Agency, the Seoul city government has identified 1,566 individuals, many of whom are heads of companies for storing their crypto holdings in three cryptocurrency exchanges.
Apparently, the crackdown resulted in the seizure of more than $22 million in digital currencies from 676 individuals. Of those 676, 118 individuals have paid back $1.1 million in the tax amount.
The majority of the seized cryptocurrencies are found to be in Bitcoin, comprising 19% of the total bust, followed by DragonVein and Ripple, both at 16%.
Meanwhile, Ethereum and Stellar holdings stood at 10% and 9%, respectively, while other altcoins holdings were 30% of the total.
Most of the tax evaders are now pleading with the government not to sell their crypto holdings as they are anticipating the value will go up and have assured on paying their taxes.
In a press release, the city government stated that:
“We are continually being asked by delinquent taxpayers to refrain from selling their cryptocurrencies as they will pay their taxes. We believe the taxpayers expect the value of their cryptocurrencies to increase further due to the recent spike in the price of cryptocurrencies and have determined they will gain more from paying their delinquent taxes and having the seizure released.”
Meanwhile, South Korea’s cryptocurrency tax law regulation is set to come into effect in January 2022. The tax regulation will involve a 20% hike on crypto trading capital gains above $2,300.
On April 19th, the country’s Office for Government Policy Coordination had announced it will begin its crackdown on “illegitimate crypto businesses” as well as all other forms of money laundering and scams involving cryptocurrencies.