More than 100 tax officials raid YG offices
YG Entertainment headquarters in Mapo District. Yonhap
By Lee Min-young
By Lee Min-young
The nation's tax agency has begun an all-out tax probe into Seungri's former agency YG Entertainment, following reports raising suspicion that YG has dodged taxes.
It remains to be seen how this audit will affect one of the three top entertainment firms, which is beleaguered as the result of alleged escapades by Seungri, a member of its marquee K-pop band Big Bang.
The agency terminated its contract with Seungri. But deprived of its cash cow, it is left with few gigs of which to depend while having to deal with a contract with a foreign financial investor.
According to industry sources on Wednesday, the National Tax Service (NTS) has raided YG's headquarters and three more buildings the agency owns in Mapo District to secure tax-related documents.
All departments, including non-finance divisions, were subject to the raid. On-site witnesses claimed that more than 100 tax officials were sent to the YG building on Wednesday.
The NTS refused to give details.
Earlier, local media reports zeroed in on YG Entertainment founder Yang Hyun-suk, pointing out that he was the virtual owner of a nightclub in Hongdae named Love Signal, which they claimed has been unlawfully registered as a restaurant instead of an entertainment establishment to dodge taxes.
Yang owns more clubs in Hongdae that allegedly avoided paying taxes in the same way, which would have given Yang huge tax benefits, according to the reports. The Food Sanitation Act stipulates that a venue registered as a restaurant must pay 10 percent tax on profits, whereas entertainment establishments must pay 13 percent.
The tax authority will launch a tax offense investigation in coordination with the prosecution and police if the probe concludes that the agency was involved in a tax fraud.
YG said it would cooperate with the investigation.