Mar 11, 2020

Seoul launches tax audit on real estate owned by Shincheonji religious sect

Lee Jeong-gyu and Suh Hae-mi
March 11, 2920

The Seoul Metropolitan Government has launched a local tax audit on real estate belonging to the Shincheonji religious sect. The city also plans to exercise its right to indemnity against Shincheonji for the costs of investigating and treating members of the church in connection with the novel coronavirus.

The city of Seoul announced on Mar. 10 that it had commenced a local tax audit on 30 properties owned by Shincheonji. The city delivered a tax audit notification to the order that morning. Shincheonji previously received reduced acquisition and property tax benefits due to its status as a religious group, and the notification stated that the investigation would examine whether this was appropriate and whether religious facilities were being used for non-religious purposes. According to current laws and ordinances, local governments are empowered to directly audit “those receiving non-taxation or tax reduction benefits of 100 million won [US$83,618] or more.” The city plans to demand payment of the reduction in acquisition and property taxes if the real estate is found not to have been used for religious facilities.

The city has estimated Shincheonji’s acquisition tax reductions over the past five years at around 200 million won (US$167,280). Its property tax reductions are currently being examined. The current plan is to investigate 207 Shincheonji facilities within the city of Seoul to determine if they are being used for non-religious purposes.
“If facilities that were claimed as religious are being used for accommodations, they are not eligible for local tax reductions,” a city official explained.

“Even in a case where a lessor loaned the facilities out to Shincheonji at no cost, it is subject to taxation if it was not used for religious purposes,” the official added.

The city also plans to request a national tax audit by the National Tax Service if evidence of national tax evasion is detected during the local tax audit.

Seoul Mayor Park Won-soon has announced plans to hold Shincheonji legally responsible for alleged hindrance of disease prevention efforts, including the presentation of unreliable lists of members. In a press conference that day, Park said, “We plan to hold Shincheonji civically responsible, exercising our right to indemnity not only for the wasted administrative costs from the full-scale examination of members and the associated disease control costs, but also for the diagnosis and treatment costs for those infected as a result of Shincheonji.”

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