South Korean City Says It Will Liquidate Tax Dodgers’ Crypto

The South Korean city of Paju says it has warned 17 residents to pay their taxes or it will forcibly liquidate their crypto holdings.

Per Yonhap News, the city says the residents have until the end of November to pay outstanding local tax bills.

South Korean City: Pay Up Or We’ll Sell Your Crypto

A Paju City official said:

“We have sent cryptoasset transfer and sale notices to 17 people so far. We have notified them of their unpaid local taxes, which total a combined 124 million won [$88,900]. If they do not settle their unpaid taxes by the end of this month, we plan to transfer their cryptoassets to the city’s crypto wallet and sell them.”

The official said Paju tax officers had frozen crypto wallets containing coins worth a total of $35,800.

“This is a clear message to taxpayers. It will show them that they cannot hide their assets, and that we will track down their assets no matter what, and then enforce penalties.”

Paju City spokesperson

Paju officials said that all the coins they had seized were held in wallets on domestic crypto exchanges.

The city is located to the north of the capital Seoul, in the traditionally affluent Gyeonggi Province.

Paju officials noted that cryptoasset adoption has “expanded rapidly,” in recent years, with tax officials concerned they are “being abused as a means for” unscrupulous people “to hide or move their assets.”

The news agency noted that the while city has previously seized crypto from local tax evaders in the past, this will be the first time it has “directly sold cryptoassets.”

This marks a major development for local governments and regional tax bodies, the news outlet concluded.

Nationwide Crackdown

Local South Korean governments have spent the past few years cracking down on tax offenders who seek to use crypto to conceal their income and assets.

More than half of South Koreans living alone have side jobs amid a growing cost-of-living squeeze, a report said Sunday.https://t.co/o9Rdf6v3jJ

— The Korea Herald 코리아헤럴드 (@TheKoreaHerald) November 18, 2024

But in recent months, they have begun using more sophisticated software solutions to help them track down tax dodgers with crypto holdings.

South Korean law also permits them to order crypto exchanges to hand over their clients’ wallet details.

The nation’s statutes also outlaw anonymous crypto trading, with all wallets tied to social security numbers and domestic bank accounts.

In June, officials in the Jeonbuk (North Jeolla) Special Self-Governing Province confiscated coins worth $138,000 from local tax dodgers.

And in August, the Seoul district of Gangnam – home to most of the nation’s major crypto companies – announced the start of its own crackdown.