Crypto News– In South Korea’s Gyeonggi province, a smart solution has been deployed to tackle crypto tax evasion, known as the ‘Arbitrator Virtual Asset Tracking Electronic Management System.’ This innovative approach managed to recoup a substantial 6.2 billion won, approximately $4.7 million, in unpaid taxes just last year.
South Korean Crypto Tax Dodger Tracking System Nets Almost 4.7 Million Dollars in Outstanding Debts
This system is capable of tracking personal information, such as phone numbers, of known tax evaders and cross-referencing them with data from crypto trading platforms. This integration has significantly streamlined the process of tracking and collecting taxes, marking a significant improvement from the previous method, which took around six months to resolve each case.
A key factor contributing to this success is the utilization of residents’ registration numbers by local municipalities to trace mobile phone numbers. This strategic move has greatly enhanced the detection rate of individuals involved in virtual currency exchanges.
Through this system, a total of 5,910 tax evaders with virtual asset accounts, including Bitcoin, were identified, and arrears were successfully recovered from 2,390 individuals over the past year.
South Korea Implements Stricter Regulations on Crypto Sector
The Financial Intelligence Unit (FIU) revealed a notable 49% surge in suspicious cryptocurrency transactions in 2023 compared to the previous year. This increase in oversight, coupled with collaborative efforts with enforcement agencies, highlights the nation’s firm commitment to combatting illicit cryptocurrency activities.
South Korea is on the brink of a significant regulatory transformation with the imminent implementation of the Virtual Asset User Protection Act, scheduled to come into force in July 2024. This legislation introduces stringent penalties, including the possibility of life imprisonment for individuals found guilty of illicit cryptocurrency gains exceeding $3.7 million.
These rigorous measures reflect South Korea’s dedication to fostering a transparent and accountable cryptocurrency market. According to Statista data, the cryptocurrency market is projected to generate approximately $2.2 billion annually by 2027.
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