National Tax Service initiates tax audit on Google Korea

The National Tax Service embarked on a tax investigation against Google Korea in relation to alleged tax evasion of high earning YouTube contents creators.

According to the IT industry on Wednesday, the National Tax Service acquired accounting related data by sending an investigator to the company building of Google Korea in southern Seoul. An investigation appears to have been initiated due to recent controversies over YouTubers failing to declare taxes even though they gained a high income. Although the investigation is a mere collection of tax information on YouTubers, the possibility that the investigation may expand to Google Korea, which receives commission from YouTubers, cannot be overlooked. YouTube is currently owned by Google.

Previously, National Tax Service Commissioner Han Seung-hee revealed that there is a need for a tax investigation against high earning YouTubers during the parliament inspections in October. “The National Tax Service has notified 513 YouTubers of declaring taxes,” Han said, adding that the state tax agency did not conduct a tax investigation. The income of YouTubers who belong to a YouTuber agency can be identified but it is difficult for the tax authority to identify the income of individual YouTubers unless they declare income.

The IT industry assesses that the tax agency's investigation may be the groundwork for building a tax basis against Google. As the amendment of the Value-Added Tax Act passed the plenary session of the National Assembly, global information communications technology companies including Google and Facebook need to pay value-added tax to the income it acquires through domestic services such as Internet advertisement and cloud computing service from July next year.


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