SM Entertainment is Under Fire as They Undergo Reports of having Special Tax Evasion Investigation!

The entertainment agency was reported that they are under investigation due to evading special taxes!

Mar 20, 2014 07:57 AM GMT

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On March 20, news outlet 'Segye' came out with a report that said that the government has begun a special tax investigation on SM Entertainment on the thought that the entertainment agency did not declare millions of dollars that they have earned. However, the agency has issued an official statement denying the report and said that they have been experiencing a routine check-up which happens some time in a few years.

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'Segye' identified that according to sources of The National Tax Service, 30 personnel have been sent out to the SM Entertainment headquarters to gather several documents and records that may suggest evidence of tax evasion. The news outlet said that slightly than giving the agency a 10-day notice in advance, which is what happens in the case of regular routine check-ups, The National Tax Service did not give the notice until the day of as this was being treated as a special investigation and they wanted to make sure there was no time for the agency to alter or destroy evidence.

As 'Segye' reported, the agency is said to have set up various paper companies in Hong Kong and such under the name of famous artists, and concealed the earnings from overseas concerts in the paper companies instead of reporting them on their tax documents.

Though, SM Entertainment has made an official statement denying that there was a special tax evasion investigation going on directing the agency. They stated, "We are sending our official statement regarding the report about the tax investigation... There is no truth to the contents about tax evasion, and we are simply under a normal routine investigation following the one we also completed back in 2009... Please refrain from making assumptions based on groundless rumours."