Cha Eun Woo Accused Of A Staggering 20 Billion Won In Tax Evasion, Agency Issues Response
A staggering 20 billion won (approximately $13,600,000) —reportedly the largest tax reassessment ever imposed on a celebrity—has placed ASTRO member and actor Cha Eun Woo at the center of a major tax evasion controversy.
On the 22nd of January, a media outlet reported that an entity known as Company A, established by Cha Eun Woo’s mother, was positioned between Cha Eun Woo and his agency Fantagio, allegedly allowing income earned by the artist to be divided among Fantagio, Company A, and Cha Eun Woo himself.
However, the National Tax Service reportedly determined that Company A was a “paper company,” concluding that Cha Eun Woo and his mother set up an entity without substantive operations to reduce income tax—which can reach up to 45 percent—by distributing earnings and applying a corporate tax rate more than 20 percentage points lower.
As a result, Cha Eun Woo was subjected to an intensive tax investigation by the Seoul Regional Tax Office’s Investigation Bureau 4 in the first half of last year on suspicion of tax evasion. It has been reported that, at Cha Eun Woo’s request, the National Tax Service waited until his military enlistment process was completed before issuing the results of the audit. Cha Eun Woo enlisted for active duty in the Army in July of last year.
In response, Cha Eun Woo’s side stated that Company A is not a shell company but a legally registered entertainment planning business, and that they have filed a pre-taxation review request to challenge the tax authority’s decision. They are currently awaiting the outcome.
Read their statement below!
Hello, this is Fantagio.
We would like to share our official position regarding the article reported today about the tax investigation involving our artist Cha Eun Woo.
This matter concerns whether the corporation established by Cha Eun Woo’s mother falls under a substantive taxation target. It is not a matter that has been finally confirmed or officially notified, and we plan to actively explain our position through lawful procedures regarding issues related to the interpretation and application of the law.
In order for this process to be concluded as promptly as possible, the artist and the tax representatives will faithfully cooperate.
Cha Eun Woo promises that he will continue to sincerely fulfill his tax reporting and legal obligations as a citizen.
Thank you.
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