Baemin, Musinsa, and Pulmuone Face Tax Probes Amid Trillion-Won Tax Evasion Suspicions

[Anchor]

The National Tax Service has launched massive tax audits against 41 companies closely tied to the cost of living, including Baedal Minjok, Musinsa, and Pulmuone. The amount of taxes allegedly evaded by these companies is estimated to be in the range of 1 trillion won.

Reporter Chae Heesun has the story.

[Reporter]

The core of the National Tax Service's tax audit into Baedal Minjok focuses on whether proper taxes were paid when profits earned domestically were transferred to overseas shareholders.

Woowa Brothers, the operator of Baedal Minjok, repeatedly purchased and canceled its own shares held by its overseas holding company.

The National Tax Service suspects whether the company intentionally purchased these treasury shares at inflated prices.

If they were bought at high prices or funds were improperly transferred, it could essentially be regarded as a dividend.

When a domestic company pays dividends or interest generated in South Korea to an overseas entity, failing to withhold and pay taxes in advance constitutes tax evasion.

Authorities also plan to investigate whether the company provided free business support to overseas affiliates and unfairly claimed value-added tax deductions.

The National Tax Service estimates that the taxes evaded by Baemin through such methods reach 100 billion won.

[Lee Sung-geul / Director General of the Bureau of Investigation, National Tax Service: By complexly utilizing capital transactions, they transferred income (to overseas holding companies) in forms disguised as 'not being dividends' or 'not being interest income.']

The targets of the tax audits also included fashion platform Musinsa and food company Pulmuone.

It is reported that two fashion platforms, including Musinsa, are being investigated for allegedly inflating production costs through omitted sales, while food companies such as Pulmuone are under scrutiny for allegedly providing massive financial support to overseas affiliates without collecting interest.

Including 11 poultry farms that underreported profits worth billions of won, the total amount of suspected tax evasion by the 41 targeted companies reaches 1 trillion won.

Given that these businesses are closely connected to everyday living costs, the National Tax Service plans to intensively investigate not only the circumstances surrounding the tax evasion but also the process by which the families of company owners built their wealth.

(Video reporting: Lee Jae-young | Video editing: Kim Jun-hee | Design: Jang Seong-beom)
※ Please note: This article was translated by AI and may contain errors.