The national tax authority in South Korea is conducting investigations on Hashed, a crypto-based firm. The head of growth at Hashed firm, Edward Hong, claimed to The Block that those investigations are not interconnected with slush funds or tax evasion. Hashed is one of the cryptos investing firms in South Korea founded in the year 2017.
The National Tax Service is carrying out some investigations on a crypto venture capital firm known as Hashed, based in South Korea. This was a report In the South Korean news through the outlet media news which were based on the tax investigations.
The 4th Bureau of Investigations is doing this activity; Seoul Reginal Tax Office within the National Tax Service is handling this investigation activity.
According to the report, the bureau is best known for conducting investigations into slush funds and tax evasion. But the nature of the investigations is not well known as per the report from the local media. Slush funds are a sum of money that is reserved for a specified use in a given business.
Lax funds can suddenly increase the amount of money and are used for justification. Most of the time, the slush funds are not put into consideration, and they are used for personal gains, or they are misused. This bureau of investigations has found nothing for persecution within the past year of investigation; hence, the firm is not likely to be.
According to a high-ranking official in the National Tax Service, the agency cannot start any investigations on small firms not unless it is related to slush fund or tax evasion by the CEO of that particular company.
The official didn’t confirm to Aju News about the investigations carried out in the Hashed company. The head of growth at Hashed, Edward Hong, informed The Block that those investigations are not related to the slush funds or tax evasion. He claimed that it was impossible to create slush funds or avoid taxes as there was no current obligation to pay taxes by individuals in South Korea.
Individual crypto taxation was supposed to be implemented from January 2022, but it was later postponed until January year 2023. The South Korean legislators actually delayed it. The traders will be paying 20% on gains made, which are above $2100 if the tax becomes effective.
Hong claimed that hashed invests in crypto through the exclusive funds, which are fully owned by individual co-founders of the company; hence it is a responsibility to pay taxes as an individual but not as a corporation. He said that in South Korea, no company is allowed to invest in crypto.
The investigations that started last month would probably end in the early next year, just a few days before the presidential elections in the country.
The information that National Tax Service has sought is not clear, but Hong said that the firm is giving total cooperation to the investigators by even providing the required information.
The news about investigations at Hashed was released after the second launch of crypto funds which were worth $200 million that was to invest in Web3 startups. Such web startups are those focused on Defi and Metaverse.
In 2017 it was revealed that the firm had launched its first funds, which worth was $120 million—the results of investigations whether they will open on any legal proceedings in opposition to the Hashed firm.
The tax authority has also carried out investigations to various crypto firms, including the Korea Digital Exchange that operates the local cryptocurrency exchange Flybit, HN Group which issued the HDAC token, Ground X, Terra, and ICONLOOP.
Featured photo source unsplash.com