Hyundai Motor Company and Kia Motors Face Tax Audit

The National Tax Service (NTS), after performing a tax audit of four affiliates of Hyundai and Kia Automotive Groups including Glovis, is evidently engaged in a tax audit of Hyundai Motor Company and Kia Motors Corp., core affiliates of the Hyundai and Kia Automotive Groups. That means the Hyundai Automotive Group as a whole is being scrutinized by the government.

The focus of the tax audit is to find out the involvement of Hyundai and Kia Motors in raising slush funds for the Hyundai Automotive Group.

According to the Hyundai Automotive Group on May 31, the National Tax Service undertook on March 23 a tax audit of Glovis, Hyundai Autonet, Amkor Technology and WIA, four Hyundai Automotive Group affiliates, before it started a tax audit of Hyundai Motor Company and Kia Motors Corp. headquarters located in Yangjae-dong, Seocho-gu, Seoul.

The NTS has reportedly uncovered how these companies raised slush funds based on the audit results of the four affiliates. The scope of the alleged tax evasion and a possible penalty tax amount will be determined by mid June when the NTS completes its tax audit of Hyundai and Kia headquarters.

koh@donga.com