South Korean government, grappling with tax revenue shortfall, to step up clampdown on $179 billion fake oil market referred to as a ‘hotbed of tax evasion.’
August 20, 2013 Leave a comment
Gov’t to step up clampdown on fake oil market
Kim Chung-hwan
2013.08.19 17:52:39
The South Korean government grappling with tax revenue shortfall, will toughen its oversight on the two trillion won ($179 billion) fake oil market referred to as a ‘hotbed of tax evasion.’ As early as next year, the Ministry of Trade, Industry and Energy will be authorized to request taxation-related information from the National Tax Service, Korea Customs Service, and municipalities when investigating into the route of fake oil products. This will tighten monitoring activities, which have been under question over their effectiveness as the task was diverted into the Ministry of Trade, Industry and Energy, Korea Customs Service and regional governments. A high-ranking official at the Ministry said Monday, “our analysis on the distribution routes of fake oil products revealed prevalent illegal activities that petrochemical materials including methanol have been sneaked from overseas into the nation to mass-produce fake oil products,” adding “so we plans to share taxation information with relevant bodies to root out such activities at the customs level.”
The government made prior announcement of the amendment on oil and oil-alternative businesses. The Ministry will put the agenda at the regular session of the National Assemble next month and implement it next year.
At the present, the Ministry can obtain taxation information from the tax authority if the act is involved in imposing fine on oil import and sales. The latest move, however, will allow the Ministry to share the information on production, import and storage of fake oil products.
The move came as the government faces higher risks of budget deficit due to increased welfare-related budget.
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