October 24, 2020

Stock inflows from tax havens top 55 tln won: data


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16468015-abstract-word-cloud-for-tax-haven-with-related-tags-and-termsFrom Global Post

SEOUL, Nov. 1 (Yonhap) — South Korea has seen foreign inflows of more than 55 trillion won (US$51.7 billion) into the local stock market from tax havens so far, data showed Friday, amid a spate of ongoing government probes into suspected tax-dodging and slush funds there by high-profile Korean businessmen and politicians.

The amount of local stock purchases made by foreign investors based in 20 tax-free regions, such as the Cayman Islands and Virgin Islands, reached 55.14 trillion won at the end of September, according to the data by the Financial Supervisory Service (FSS) submitted to parliament.

The figure has been on the rise from 52.12 trillion won in 2012 and 44.29 trillion won as of end-2011.

A total of 1,929 investors — consisting of 117 financial firms, 1,360 funds, 45 companies and two individuals — were among those who made bets in Seoul shares, the data showed.

Of the 20 tax havens, Luxembourg-based investors held the largest amount of local equities worth 26.41 trillion won, followed by those in Ireland with 14.54 trillion won and the Cayman Islands with 7.58 trillion won, in the same period.

The data came as more than a score of big-name businessmen and children of a former South Korean president have been under scrutiny by the prosecution and the public for allegations that they evaded taxes and stashed away secret funds worth hundreds of billions of won.

Lawmakers have voiced the need to amend measures, including improving reward system for tip-offs and whistleblowers or expanding investigation into overseas paper companies, so that more tax evaders or slush fund owners can be brought to justice.

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