Nearly 40 performers and concert officials hit with 5.56 billion won tax bill for shows by foreign artists

Nearly 40 performers and concert industry officials have been hit with 5.56 billion won ($4 million) in back taxes after authorities uncovered unreported income linked to performances by foreign artists in Korea.

The National Tax Service (NTS) found tax reporting omissions involving 39 people and collected a total of 5.56 billion won in back taxes, according to data submitted to Rep. Jung Tae-ho of the Democratic Party on Thursday.

The NTS found the cases when reviewing whether taxes had been properly withheld for 110 people involved in performances by foreign artists in Korea in July last year.

Under current law, foreign nationals seeking to perform in Korea or organizers seeking to bring them to the country must obtain a recommendation from the Korea Media Rating Board. The NTS receives related recommendation data from the board every quarter and uses it for taxation purposes. It cross-checked data on foreign performers' activities in Korea between 2022 and 2024 against foreign exchange transaction records, payment statements and other information to identify suspected cases of unreported income or taxes.

The review primarily targeted cases in which performance fees exceeded a certain threshold but no payment statement for personal services provided by nonresidents had been submitted. It also covered cases in which at least three applications for performances in Korea were filed and suspected unreported or underreported withholding tax liabilities exceeded a certain amount.

The NTS made less use of the Korea Media Rating Board's data in 2020 and 2021 as performances by foreign artists fell sharply during the Covid-19 pandemic. But as concerts rebounded after the pandemic, the amount of data available for tax purposes also surged.

The number of records related to performances by foreign artists in Korea rose from 682 in 2021 to 1,857 in 2022, 2,425 in 2023 and 2,824 in 2024 — more than quadrupling over three years.

Rep. Jung said the fact that reporting omissions involving payments to foreign performers resulted in additional tax collection showed a need to strengthen the tax administration system.

“With concerts by major international artists increasingly taking place in Korea, tax administration for income earned in Korea by foreign performers also needs to be handled more carefully,” Jung said. “The NTS should closely examine taxation practices and strengthen its management system to prevent repeated reporting omissions.”

BY JEONG JAE-HONG [[email protected]]