National Tax Service`s Track of Account without Warrant Has Increased

It was reported that the National Tax Service (NTS)`s track of financial account has been greatly increasing every year.

The NTS` misuse of account track seems to create a stir at the National Assembly`s annual audit of the executive branch since the NTS can demand an account inquiry to the financial organizations under its own judgment, whereas the prosecution is restrained and investigated by the court when it tracks the account.

According to the National Assembly`s annual audit documents, which were submitted by the NTS to Rep. Kang Woon-Tae (MDP) and Rep. Park Jong-Keun (GNP), the members of the finance and economy committee of the National Assembly, the number of NTS` investigation cases in relation to the tax investigation increased from 1,308 in 1999 to 1,657 in 2000, with the 26.7 percent increase. Moreover, the number of financial account investigation cases was 838 during the first half of this year (Jan-June), which was more than a half of the total number of cases per year.

The NTS` financial account investigation cases were 1,099 cases in 1996, 1,221 cases in 1997 and 1,329 cases in 1998. 1.6 percent decreased only in 1999.

The NTS said that ``when there is a suspicion of tax omission, we investigate the financial account within the minimum range to insure the proof of taxation.`` However, the opposition party and the social organizations are pointing out the possibility of misuse of `account track without warrant`.

In relation to the tax investigation of the press firms, the `meeting of lawyers who consider constitution` (president Chung Gi-Seong) requested the NTS to open the information in public in May, asking whether the NTS is tracking the accounts of the officials of the press firms and if so the NTS should publicize the results and the legal ground. However, as the requested was not accepted by the NTS, the lawyers` meeting filed a lawsuit for the opening of the information in public to the Seoul Administrative Court on August 24th.

The NTS said the increasing investigation of financial account last year and this year was because it has intensified the tax investigation on income earners through the unlawful tax omission, like private moneylenders, and because the tax investigation as well as the investigation on the tax infringement has increased.

The NTS announced that the number of investigation cases on the income earners through the unlawful tax omission and the amount of additional tax collection as such; 5,155 cases (2.5019 trillion won) in 1999; 6,507 (3.4730 trillion won) in 2000; 3,156 cases (1.6149 trillion won) during the first half of the year 2001. Investigation cases on the tax infringement and the amount of additional tax collection are as such; 121 cases (209 billion won) in 1999; 102 cases (338.8 billion won) in 2000; 63 cases (284.1 billion won) during the first half of this year.

Cheon Kwang-Am iam@donga.com