SEJONG, Jan. 16 (Yonhap) -- South Korea's customs agency said Wednesday that it will step up its crackdown on offshore tax evasion in line with the incoming government's pursuit of regularizing the underground economy to find hidden assets and expand its tax base.
In its policy briefing to the presidential transition committee, the Korea Customs Service (KCS) vowed to focus its capacity this year on collecting information on offshore paper companies intended to evade tax payment. It also promised to toughen foreign currency-related crimes, including money laundering.
During the January-September period of last year, the KCS caught 1.89 trillion won (US$1.79 billion) worth of currency-related crimes, including stashing away assets in overseas countries. That was up 68 percent from the same period a year earlier.
The increased focus on offshore concealment of assets and other tax evasion attempts comes in line with policy stances taken by other government agencies to support the incoming government of President-elect Park Geun-hye in enforcing its planned welfare spending plans.
Park has unveiled diverse welfare programs, including free child care and college tuition subsides, ahead of the Dec. 19 presidential election. Experts put the estimate cost from such campaign pledges at about 135 trillion won for the next five years.
Concerns are growing that the government might not be able to meet its planned expanded spending as the economy is showing few signs of fast rebounding, which could end up denting the country's forecast tax revenue.
On Monday, the National Tax Service Commissioner Lee Hyun-dong convened a closed-door meeting with heads of regional tax offices, asking them to increase efforts to collect unpaid taxes and also clamp down on tax evasion attempts especially by high-income earners.
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