NTS Adopts Sample
Tax Survey System

Commissioner Lee says this year will see less regular tax audits

National Tax Service Commissioner Lee Ju-sung announced a plan to conduct less tax audits in an apparent move to allay mounting concerns over widespread tax probes into corporations.
NTS Commissioner Lee said in a meeting of reporters on January 23, "This year will overall not see tax investigations rising."His comment drew keen attention following NTS's last week announcement of a plan to conduct preliminary sample tax probes into 116 companies.
He indicated tax authorities'willingness to take steps designed to stabilize the real estate market if necessary, saying that NTS is keeping a watchful eye over possible speculation in Pangyo, a planned new satellite development area.
Commissioner Lee denied preliminary sample tax probes targeted at family-owned conglomerates. "Corporations with more than 30 billion won in sales contribute to 74 percent to 75 percent of corporate tax revenues. The coming preliminary tax probe will not weaken economic activities and the surveyed companies will not have disadvantages and even this year's regular tax investigations will decline.
"Asked to comment on concerns that the sample tax probe is designed to raise tax revenues under the ever-worsening budgetary constraints, NTS Commissioner Lee said the tax agency had prepared a preliminary tax survey from last October, and the target companies have been selected after scrutinizing a possibility of tax evasions.
If companies whose financial year ended on December 31 report their corporate income tax faithfully, he said, tax authorities would conduct regular tax investigations into the smaller number of companies. Capitalizing on a preliminary sample tax survey in place in advanced countries, he said, NTS works not only to enhance tax fairness but also to raise tax revenues.
Concerning the reemerging real estate speculation, Lee said, tax authorities'commenting on the conditions of the real estate market is not appropriate, but they will watch closely the possibility of real estate speculation in the planned new satellite development area of Pangyo. He said NTS will decide in April or May how to take countermeasures following its initial investigation into the Pangyo area.
NTS Commissioner Lee said his agency has yet to determine when tax authorities begin probes into the owners of more than three houses. He added that tax authorities have been gathering data on the triple house owners, and his agency will concentrate on building up infrastructure on the data on taxable incomes during his term. nw

National Tax Service Commissioner Lee Ju-sung

NTS Head office in downtown Seoul