Daum Kakao Audited by State Tax Office
kpride, June 16, 2015, 9:37 a.m.
The state tax office on Tuesday started an audit into Daum Kakao Corp., one of South Korea's leading Internet service companies, industry sources said. Some 50 investigators from the Seoul Regional Tax Office descended on Daum Kakao's office in Pangyo, south of Seoul, to conduct an on-site inspection, according to the sources.
Daum Kakao operates South Korea's top mobile messenger, KakaoTalk, which has more than 35 million local users. It was unclear whether the latest audit is a regular one, which is carried out every few years or a special probe conducted when authorities want to scrutinize the books of a particular company suspected of dodging taxes.
A special tax audit is usually carried out without prior warning so a company cannot hide or destroy evidence. "Judging by the large number of investigators sent, and the fact that Daum Kakao was unaware of the probe, it may not be a regular inspection," an observer said.
The tax office remained silent on the matter, but industry watchers speculated that Daum Kakao may have come under suspicion for tax dodging, unfair support of affiliates or irregularities related to last year's merger deal. The company was created through the merger of Daum Communications and Kakao. Daum Kakao, meanwhile, did not offer an official response to the tax probe.