Next month, the Gwacheon City in South Korea will introduce a digital resource electric arrest system to track and defraud bitcoin from tax evasion.
Full-scale seizures are anticipated to begin in the first half of the year, according to a translated local media report. The system will help authorities find hidden assets and carry out tax collection.
The city has identified 361 individuals who owe more than$ 2, 060 ( 3 million won ) in local taxes, with total arrears reaching about$ 12.9 million ( 18.8 billion won ).
Officials intend to follow these tax evaders by comparing their records to those of the nation’s top national crypto exchanges.
Local authorities have the authority to seize digital assets from tax evaders, despite the South Korean government’s planned 20 % crypto tax being delayed until 2027.
Gwacheon officials claim that the introduction of an electronic seizure system is essential to ensuring fairness and closing tax gaps.
According to Gwacheon City Tax Division Chief Kang Min-ah,” This measure is a decision to establish tax justice so that citizens who faithfully pay their taxes are not disadvantaged.”
Before seizing any assets, Gwacheon reportedly will issue advance warnings to encourage voluntary payment and prevent unnecessary disputes.
Authorities will begin crypto seizing and collecting money if residents don’t pay their taxes by the due date.
The city has already seized$ 206, 000 ( 300 million won ) worth of crypto from tax evaders over the past five years, recovering$ 75, 500 ( 110 million won ) in unpaid taxes in 2024 alone.
Officials anticipate that the new system will significantly enhance enforcement.
According to Kang,” this is a strong response to tax delinquents,” and it will demonstrate how the government will “actively block tax evasion through the seizure of virtual assets.”
India is adopting a much more stern stance on cryptotaxation as South Korea tightens its grip on tax evasion.
In the 2025 Union Budget, new amendments were proposed that would allow tax authorities to examine undisclosed crypto gains from the previous 48 months, with offenders facing a 70 % fine on unpaid taxes.
The 30 % tax on crypto earnings and the 1 % TDS on transactions remain unchanged, offering no relief to traders.
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