After 15 years of evasion, Kwon Hyuk commits to pay nearly 4 trillion won in tax arrears following pressure from authorities
Category: Politics
In a remarkable turn of events, Kwon Hyuk, the so-called "shipping king" of the Sido Group, has agreed to settle his long-standing tax debt of 3.938 trillion won (approximately $3 billion) after 15 years of evasion. This decision comes in the aftermath of intensified efforts by South Korea's National Tax Service (NTS), which included plans to seize his overseas assets.
On October 8, 2026, Im Gwang-hyeon, head of the NTS, revealed during an interview on MBC Radio's Kim Jong-bae's Focus that Kwon's commitment to pay was significantly influenced by the prospect of asset seizures. He explained, "It seems that the pressure from our attempts to seize his overseas properties made him feel burdened." Kwon, who has no assets in South Korea and owns hundreds of ships registered in countries like Panama and Liberia, faced mounting scrutiny as the NTS reached out to tax authorities in those nations to gather information about his holdings.
Kwon's tax troubles date back to 2011 when he was notified of tax liabilities amounting to 4.1 trillion won. For years, he resisted payment, leading to a series of legal battles against the NTS. In a recent development, Kwon submitted a payment plan that included an initial cash payment of 1 trillion won made in July 2026, with the remaining amount to be secured through the provision of five ships as collateral.
Im confirmed that the total value of the five ships significantly exceeds 3 trillion won, making them clear and uncontested collateral. He stated, "If he fails to pay the outstanding amount, we can typically dispose of the collateral to recover the debt." The NTS has been proactive in its approach, establishing a special task force to address high-value tax delinquents, which has led to Kwon's case being highlighted as a major success.
In addition to the financial pressure, the NTS has also taken a personal approach, urging Kwon to return to South Korea and resume business operations here. Im mentioned that team members personally encouraged Kwon to settle his debts and suggested, "How about coming back to Korea and doing business here after settling your taxes?" To this inquiry, Kwon has yet to provide a definitive response.
This candid conversation reflects a broader strategy by the NTS to collect outstanding debts and to promote a culture of compliance among high-profile business figures. Im remarked, "We are committed to ensuring that no one can hide assets anywhere in the world and will pursue collections vigorously." The NTS is also planning to convert its task force into a permanent unit to continue tracking down high-value tax evaders.
The situation surrounding Kwon is indicative of a larger issue within South Korea's tax collection system. Im emphasized that nearly half of Kwon's total tax debt consists of penalties, late fees, and surcharges accrued over the years. He stated, "Many citizens have expressed curiosity about why interest or late fees have not been applied to such a substantial amount left unpaid for 15 years. Naturally, almost half of this total amount includes additional charges related to late payments and penalties."
Im noted that public awareness surrounding tax evasion has improved significantly compared to the past. He highlighted the advancements in information technology that have made financial transactions more transparent, thereby reducing the size of the underground economy. He stated, "In the past, the scale of the underground economy was considered substantial, but now it has shrunk significantly due to enhanced transparency in payment systems."
Looking ahead, the NTS is set to intensify its investigations into corporate tax evasion practices, particularly those involving the misuse of corporate identities for personal gains. Im pointed out concerning behaviors such as the private use of luxury vehicles and extravagant corporate residences, stating, "If owners exhibit such behaviors, we view them as high-risk indicators for tax evasion and will conduct thorough investigations into the companies involved."
As Kwon prepares to fulfill his payment obligations, the NTS is optimistic that this case will serve as a deterrent to other high-profile tax delinquents. The agency aims to create a fair and just tax environment where compliance is the norm rather than the exception. Im concluded, "We will continue to pursue tax collections until every last cent is recovered, reinforcing the principle of tax justice in South Korea."