The South Korean city of Cheongju, the capital of North Chungcheong province, has announced its intention to seize cryptocurrency from local tax evaders.
The administration of Cheongju has instructed seven South Korean crypto exchanges to investigate the holdings of thousands of individuals who have evaded taxes, as reported by local news agency Yonhap on Aug. 22.
The city authorities have directed trading platforms such as Upbit and Bithumb to examine the crypto assets of 8,520 users who owe at least 1 million won ($750) in local taxes. After the investigation, Cheongju plans to confiscate cryptocurrency from these tax evaders.
According to the city administration, cryptocurrencies have increasingly been used as a means to hide assets in South Korea. This new initiative aims to hold accountable South Korean residents who have evaded their tax responsibilities.
Upbit and Bithumb have not yet responded to Cointelegraph’s request for comment.
In 2022, the Cheongju administration reportedly recovered overdue taxes from 17 people after receiving information about the cryptocurrency holdings of around 16,000 crypto investors. A total of 68 million won ($51,000) was collected by the city.
Tax-related cryptocurrency seizures have been on the rise in South Korea in recent years. In 2022 and 2021 combined, the South Korean government confiscated up to 260 billion Korean won ($180 million) worth of cryptocurrencies from tax evaders. In 2021, the city administration of Seoul, the capital of South Korea, seized crypto valued at 25 billion won ($22 million) from individuals and company executives.
Related: Coin Center responds to US lawmakers’ request for crypto tax guidance
These seizures occurred shortly after the South Korean government enacted laws allowing regulators to confiscate cryptocurrencies like Bitcoin (BTC) from tax evaders in 2021.
South Korea is not the only country that seizes cryptocurrency from tax evaders. Last year, Argentina’s tax authority confiscated over 1,000 cryptocurrency wallets belonging to taxpayers who were overdue in the country. The United States Internal Revenue Service also engages in cryptocurrency confiscations from tax evaders, according to IRS deputy associate chief counsel Robert Wearing.
Collect this article as an NFT to preserve this moment in history and show your support for independent journalism in the crypto space.
Magazine: Big Questions: Did the NSA create Bitcoin?