NTS vows to claw back real estate tax-evasion proceeds, extends audit deferrals for regional firms

The National Tax Service said it will deploy every available tool to recover income concealed through real estate tax evasion — including the misuse of business loans — that distorts market order.

At the same time, the NTS will support the pan-government regional growth initiative by offering dedicated tax consulting for small and medium-sized enterprises relocating to the provinces and extending the regular audit deferral period for regionally based companies by up to three years.

The agency will also reinvent itself as an "integrated fiscal revenue authority" that collects not only national taxes but also non-tax national revenue, in support of the push to make South Korea a globally dominant industrial power.

NTS Commissioner Lim Gwang-hyeon presented these key priorities at a ministerial work briefing held Wednesday at Cheong Wa Dae's state guesthouse.

The NTS formally declared its transformation into an "integrated fiscal revenue authority." Starting next year, the agency will take over unified collection of non-tax national revenue currently managed in fragmented fashion under more than 300 separate laws. To that end, it will support the legislative process for a related bill introduced in February and build a database using delinquent taxpayer information secured through inter-agency agreements.

Once the legislation takes effect, billing and delinquency data on non-tax national revenue from all ministries will be linked in real time to the NTS tax administration system.

In the second half of this year, the NTS will put a 10,000-strong delinquency management corps into full operation to establish a systematic framework for tracking 130 trillion won ($87.1 billion) in outstanding tax arrears.

The NTS noted that in its first-round recruitment of 5,500 corps members for the second half, workers in their 20s and 30s accounted for 41.8 percent of hires, saying the drive has helped create jobs for young people who had been neither working nor seeking employment.

The NTS said it is determined to eradicate antisocial tax evasion and delinquency without exception. Ongoing investigations into tax evasion that threatens economic stability — including price-manipulation schemes, stock market irregularities and offshore tax dodging — will continue until markets return to normal.

Over the past six months, the NTS conducted investigations resulting in 117 cases of price-related tax evasion with 319.5 billion won in additional taxes assessed, 27 cases of stock-related evasion with 257.6 billion won assessed, and 398 cases of real estate tax evasion with 48.1 billion won assessed.

The agency will also continue probing the private misappropriation of corporate funds — cases in which controlling shareholders or their associates use company-owned assets as if they were personal property, drawing widespread public outrage.

In the second half of this year, the NTS will shift its focus beyond luxury cars to the misuse of ultra-high-end residential properties. Investigators will concentrate on so-called "emperor residences" — cases in which a controlling shareholder has lived rent-free for more than 15 years in an expensive mixed-use apartment owned by the company.

The NTS said it will closely analyze the 1,168 tip-offs received through its real estate tax-evasion reporting center as of last month and will use every available means to recover concealed income from real estate tax evasion, including circumvention of loan regulations and the misuse of business loans for unauthorized purposes.

Malicious high-value and repeat tax delinquents will face civil litigation and forced auction of assets, and assets hidden overseas will be pursued to the end.

The NTS said it will overcome "K-shaped polarization" and support balanced national growth through inclusive tax administration. A second round of delinquency management corps recruitment — targeting 4,000 positions — is planned for October. The agency will also launch "Startup Tax Care," a tax consulting program aimed at young entrepreneurs.

A moratorium on tax audits for small business owners with annual sales below 1 billion won will be extended through the end of the year. An "overseas market development tax support team" will also be launched to hold tax seminars on overseas expansion strategies for small and medium-sized enterprises.

The NTS will continue its push to transform tax administration through "K-AI," aiming to deliver a level of taxpayer convenience where citizens no longer need to know where their local tax office is.

The agency will also develop an AI-powered tax evasion detection system that automatically flags suspicious activity when basic corporate information is entered. To foster a work environment where staff can focus on their duties and deliver results, the NTS plans to operate a performance incentive program, expand specialist positions, and streamline unproductive tasks including redundant and overlapping work.

"Over the past six months, changes that began with the voices of the people — stripping away privilege and rule-breaking — have been bearing fruit across the field," Commissioner Lim said. "In the second half, we will become a National Tax Service that supports the great leap forward of an irreplaceable Republic of Korea, with results that exceed the public's expectations."