National Tax Service launches regular investigation on Samsung flagship


Samsung Electronics, which had been putting off a regular tax investigation for almost half a year, is now in the midst of the probe launched by the local tax authorities.

About 30 officials of the National Tax Service were dispatched to Samsung Group’s flagship unit earlier this week, according to government and industry sources.

While the investigation was part of the regular probes launched every four years by the tax office, one point to note was that the authorities were sent from Seoul, and not the provincial tax office overlooking Gyeonggi Province, which is the registered address of Samsung Electronics.

“This could mean that Samsung Electronics is facing a tough probe this time,” said one industry source, declining to be identified.

Another indicator of tough times to come was that Samsung is the first company to face the test since the NTS Commissioner Lee Hyun-dong on July 12 requested at a meeting with nationwide tax office executives to better screen the corporate sector for tax irregularities.

But most industry watchers appeared skeptical of the government coming with any dirty laundry to air regarding Samsung.

“Samsung has just helped the country win an important host position. Unless the authorities are met with a glaring problem that simply cannot be overlooked, we don’t expect any damaging results from this probe,” said another business source who requested anonymity, citing the sensitivity of the issue.

Samsung Group owner Lee Kun-hee, who is a member of the International Olympic Committee, had received warm congratulations at home this month for his discreet role in helping PyeongChang win the bid for hosting the 2018 Winter Olympics after two unsuccessful attempts.

Samsung officials also dismissed speculation suggesting that the tax investigation may be tied with the business tycoon’s previous controversial remarks that appeared to disapprove of the government’s economic policies.

Previously in 2007, Samsung Electronics was ordered to pay additional taxes of 18 billion won ($17 million) when it was subject to the first tax investigation in over a decade.

Samsung Electronics is not the only Samsung affiliate to face the latest probe, as the authorities have been looking into Samsung Fine Chemicals since early this month.

They have already probed Samsung Everland, Samsung Corp., Hotel Shilla and Samsung Heavy Industries.

By Kim Ji-hyun  (jemmie@heraldcorp.com)