Corrupt tax officials

Korea Herald, July 31st, 2013

Public trust in the nation's tax office has taken another tumble with the emergence of allegations that a former chief of the National Tax Service took bribes from CJ Group in return for favors during a tax audit years ago.

Prosecutors have already arrested Heo Byung-yik, a former deputy commissioner of the NTS, on suspicion that he took bribes from CJ, a food and entertainment conglomerate whose chairman, Lee Jay-hyun, was recently indicted on charges of dodging taxes and misappropriating corporate money.

Heo is suspected of having received $300,000 in U.S. currency from the business group in 2006. But he was quoted as saying that he had delivered the money to Jeon Goon-pyo, who was appointed the NTS commissioner at the time.

Prosecutors hence raided Jeon's residence to obtain financial documents that would prove his receipt of illegal money from CJ. They also searched the Seoul office of the NTS to seize documents related to the tax audit on CJ in 2006.

Jeon is suspected of having helped CJ emerge unscathed from the tax audit. At the time, the NTS' Seoul office secured evidence that the group and its chairman evaded some 360 billion won in corporate and income taxes. But the tax office refrained from levying any taxes on them.

But Jeon strongly denied that he had received any money from CJ. Prosecutors have summoned him for questioning. Jeon was recently released from prison after serving years for taking bribes in 2006 from the then head of the Busan branch of the NTS, who wanted a promotion.

The investigation into Jeon and Heo comes at a time when the NTS is making determined efforts to shake off its image as a corrupt and untrustworthy public agency.

In March, NTS chief Kim Deok-joong pledged to uproot tax corruption before waging a war against the underground economy.

In May, he launched a task force to inspect tax officials and introduced a "one strike and you are out" system in which a tax inspector will be transferred to other fields if he is found to have received illegal money even once in connection with his job.

In June, he invited a prosecutor to lead the inspection task force and ordered tax officials not to meet taxpayers after undertaking a tax inspection.

The latest probe into former top officials is demoralizing to incumbent NTS officials. But Kim should not allow it to derail his campaign to clean house. The corrupt former officials should serve as examples.



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