SEOUL — South Korea’s National Tax Service (NTS) has made a major breakthrough in recovering delinquent taxes from high-net-worth individuals, as Kwon Hyuk, chairman of Seido Group—widely known as the country's top individual tax defaulter—has submitted a comprehensive repayment plan and paid 100 billion won in cash upfront.

The NTS announced on the 7th that Chairman Kwon has pledged to fully pay off his personal tax arrears amounting to 3.938 trillion won (approx. $2.9 billion USD based on historical context, though reported as 3,938 billion won in local currency terms), following an intensive overseas asset-tracking operation by the agency’s special task force.

Kwon's tax arrears had remained unresolved for approximately 15 years since the initial comprehensive income tax notices were issued in 2011. The 100 billion won cash payment marks the largest single cash tax settlement by an individual in the history of the NTS, shattering the previous record of 50 billion won.

To cover the remainder of his arrears, Kwon has provided five overseas vessels as collateral. While the NTS withheld specific valuations and flags of convenience due to ongoing international tax cooperation and collateral assessment procedures, authorities stated that the vessels possess a value well exceeding the remaining balance.

When combining Kwon’s personal arrears with the secondary tax liabilities assigned to related corporate entities, the total book-value arrears amount to 7.902 trillion won. However, because the personal arrears and corporate secondary liabilities overlap structurally, Kwon's full payment of his 3.938 trillion-won personal balance will naturally extinguish the related corporate liabilities.

"This is the first time in NTS history that such a massive amount of delinquent tax has been paid," NTS Commissioner Lim Kwang-hyun said during a briefing. "Once the remaining balance is paid according to the plan or the collateral is forcibly collected, roughly 800 billion won in total arrears will be wiped out."

Kwon had previously contested the tax assessments, arguing that he was a non-resident of South Korea and thus owed no taxes. Analysts note that the intensified crackdown on hidden overseas assets by the tax authorities ultimately drove him to express his willingness to make a full settlement.

"Chairman Kwon expressed his desire to contribute to the national economy like Jang Bogo (a historical Korean maritime hero) through his shipping business," said Ryu Choong-sun, International Tax Bureau Director at the NTS. "He appears to have concluded that continuing operations under the current high-risk circumstances would be exceedingly difficult."

Since launching the special task force on high-value arrears in January, the NTS has concentrated its capabilities on tracking hidden assets abroad. The agency dispatched delegations to key countries and held emergency information-sharing meetings to expand international collection cooperation with foreign tax authorities.

Key milestones included strengthening ties with flags of convenience—nations frequently used for ship registration due to regulatory and operational benefits. Commissioner Lim noted that fruitful dialogues were held with the tax authorities of Liberia and Panama, alongside smooth ongoing information exchanges with the UK tax authority.

To institutionalize these achievements into a permanent collection system, the NTS plans to reorganize its structure. It will establish "Special Investigation Teams for Tax Audits and Arrears Tracking" within irregular investigation bureaus across regional tax offices, starting with the Seoul Regional Tax Office.

These special teams will investigate tax evasion schemes while conducting irregular tax audits on delinquent individuals and associated corporations suspected of illicit capital outflows. Staff specializing in irregular criminal tax investigations, asset tracing, legal reviews of seized assets, and overseas intelligence collection will be selected between November and December.

"Building on the success of this task force, we will ensure that short-term collection results translate into mid- to long-term gains," Commissioner Lim emphasized. "We will track and decisively collect taxes regardless of whether they are hidden domestically or globally, ensuring that tax justice is served and a fair tax environment trusted by the public is established."

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