South Korean tax authorities demand $ 78 million from Luna token founder

South Korea’s National Tax Agency has imposed a 100 billion won ($ 78 million) fine on Terraform Labs and its co-founder Do Kwon, accusing him of tax evasion.

Local media reports claimed that Kwon did not want to provide real reporting to the tax authorities, and therefore tried to liquidate Terra’s internal operations shortly before the collapse of LUNA.

The company was also registered not only in Singapore but also in the Virgin Islands. Under South Korean law, companies are taxed at the place of actual management. Despite the fact that the founders of LUNA had international registrations, all subsidiaries were managed from Korea, and therefore tax deductions should have been much higher than those paid.

It is worth reminding that Kwon will have to defend himself against the tax authorities' claim without top lawyers who have left the company and taking into account the asset freeze sought by the affected investors together with the country’s largest law firm.