Amid the ongoing Terra debacle, founder Do Kwon has now reportedly come under further scrutiny from the South Korean government for alleged tax evasion.
South Korea’s Tax Service is charging Kwon and Terraform Labs with over 100 Billion Won ($78.4 Million) in unpaid taxes.
Terra (LUNA)’s head Do Kwon has been under scrutiny since the collapse of its network. However, he has laid out some plans in a bid to revive the Terra Chain.
Kwon to pay $78 Million in taxes
According to reports, the country’s tax authorities have charged Terraform Labs and its CEO for dodging Income and Corporate tax. Kwon and Terraform were unhappy with the taxation policy in the nation since December 2021. He even tried to liquidate a domestic corporation in order to move overseas and that too just before the Lunar crash. This has directly raised the suspicions over Kwon avoiding paying taxes.
Earlier, a South Korean lawmaker raised his voice to summon Kwon to investigate the Terra crash matter. Terra Luna, a cryptocurrency with a market capitalisation of over $40 Billion collapsed within just a week. As per the report, the National Tax Service recently alerted Terra’s founder, Terraform Labs and other officials to pay a 100 Billion won levy. However, the agency has even conducted a special tax investigation against Terra’s parent company in June 2021.
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The investigation depicted that CEO Kwon holds a 92% in share in Terra Singapore. While Daniel Shin, CEO of Chai Corporation, who earlier denied having any connection with Terra holds around an 8% stake. Meanwhile, the report shows that Chin is a registered director in the firm.
The South Korean Tax agency’s October investigation resulted in the imposition of 4.66 billion won (approx $3.64 million) in Income tax on Terra Virgin. In addition, a corporate tax of 44.47 billion won (approx $34.7 million) was also pressed on the firm. The Tax agency also added that Luna Foundation Guard ( LFG ) which was established overseas by the Terra in an order to avoid taxes.
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