Cheongju, the capital and largest city of South Korea’s North Chungcheong Province, says it has seized crypto from 203 residents since 2021.
The South Korean news agency Yonhap reported that city authorities say the residents all failed to pay their local taxes.
The city also announced that it has opened a trading account on an unnamed domestic crypto exchange, becoming one of the first government bodies to do so.
Cheongju, North Chungcheong Province, South Korea. (Source: Minseong Kim [CC BY-SA 4.0])Seized Crypto: We Will Sell Coins Directly, Says City
Cheongju’s move follows a recent ruling from the regulatory Financial Services Commission (FSC). The FSC is gradually opening the door to corporate crypto investment, beginning by allowing government organs and charitable organizations to buy and sell coins.
The city says that if residents fail to pay their outstanding tax bills, it will use its powers to oblige crypto exchanges to hand over data pertaining to these residents’ crypto wallets.
Local tax bodies have the power to freeze coins belonging to tax evaders. But the new wallet will let tax officials forcibly transfer crypto to the city’s wallet.
From there, city officials said, it will be “sold directly.” The city will then transfer the fiat to its treasury.
The city says that its latest crackdown on tax evaders has seen tax officials seize coins from 161 individuals who collectively owe the city around 1.5 billion won ($1.1 million).
‘No More Crypto Tax Havens’
Previously, the city had to use methods such as transaction suspension orders to take hold of tokens. But the success of the crackdowns was “limited due to Cheongju’s lack of a means to convert them into cash,” Yonhap wrote.
The city said it will advise tax evaders to sell their cryptoassets so they can pay their outstanding bills.
But, if necessary, the city said, it will “take steps to liquidate the funds.” A Cheongju city official said:
“We will do our utmost to collect the money owed to the city. We will ensure that the crypto sector no longer provides a tax haven for delinquents.”
Last month, the district of Gangnam, in Seoul, announced it was stepping up its own crypto confiscation program for tax evaders.
The district, which is home to most of the country’s biggest crypto companies, has seized 340 million won ($244,480) since the end of last year.
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