South Korean tax authorities have launched tax investigations targeting star lecturers at major private academies as part of the government’s efforts to identify alleged irregularities in the operations of hagwon, or private education institutions.
According to local reports and education insiders on Friday, the National Tax Service conducted a special tax audit of Hyun Woo-jin on Thursday, a math instructor at Megastudy, one of Korea’s biggest hagwon companies.
The NTS is reportedly looking into tax evasion allegations that several high-paid famous instructors at big hagwon have paid less taxes by not reporting income gained from selling their textbooks to students or their special lecture courses. Apart from Hyun, the names of other star lecturers are yet to be revealed.
The abrupt inspection comes after Education Minister Lee Ju-ho vowed that the ministry would launch a nationwide crackdown to combat what he called private education “cartel” profiteering from students and parents via false advertising and to receive reports of hagwon irregularities.
On Wednesday, the NTS sent investigation officers to some of the nation’s biggest and most well-known hagwon firms -- Megastudy, Sidae Injae, Uway and Jongro Academy -- to conduct tax audits to inspect whether there has been any improper management of tax payment by the companies.
Amid rumors that the crackdown is only aimed at the large and well-known private academies, the Ministry of Education said Friday that it is investigating all types of hagwon -- regardless of their size -- for irregularities, focusing on the reports received.
Separately, the ministry said that it had received a total of 165 reports of hagwon industry irregularities as of Thursday at 6 p.m. -- one week after announcing they would accept the complaints -- including suspicions that several big hagwon forced students and parents to pay for their self-made textbooks to enroll in lectures to boost school grades.
The Education Ministry will be accepting reports on its website until July 7.
