The National Tax Service (NTS) has officially begun developing a dedicated computer system for tracking and analyzing cryptocurrency transactions.
On May 11, the NTS announced that the Seoul Regional Tax Office's Information Center and Nanal SMI held an inauguration ceremony for the 'Integrated Analysis System for Virtual Assets' on May 8.
The project aims to be completed by the end of December this year, with a total budget of 2.99 billion won (including value-added tax, excluding procurement fees).
The NTS's initiative is driven by the structural characteristics of virtual assets. Due to their anonymity and decentralization, cryptocurrencies have increasingly been misused for illegal activities such as money laundering, irregular gifting, and offshore tax evasion. Additionally, starting in 2027, cryptocurrency businesses will be required to submit individual transaction data to the NTS, making it urgent to establish a systematic computerized foundation for utilizing large volumes of transaction information in tax audits.
The core of the system will be divided into three main components. First, it will create a foundation for the continuous and systematic integration of cryptocurrency transaction information and blockchain transaction data. The system will periodically collect transaction statements and summaries submitted by cryptocurrency businesses to the NTS, allowing for integrated queries linked with existing tax data for reporting, tax assessments, and audits. For each taxpayer, it will provide information on transaction overviews, changes in virtual asset holdings, and current balances, while enhancing transaction tracking by visualizing identified wallet addresses alongside blockchain transaction data.
The system will go beyond simple data collection. It will include features designed to analyze and verify transaction flows suspected of tax evasion, such as money laundering and unreported inheritance or gifting. An analytical framework will also be established to proactively detect unusual transaction patterns and suspicious individuals using AI machine learning and statistical techniques.
User convenience and information security have been prioritized in the design principles. The system will automate manual tasks and connect data from various sources while implementing a control system to ensure that transaction information is used only within the necessary scope through access management and log tracking.
The NTS stated, "By systematically managing vast amounts of cryptocurrency transaction data, we expect to enhance the efficiency of related operations and strengthen the infrastructure for virtual assets. We aim to contribute to tax fairness and justice by blocking illegal transactions such as money laundering, irregular gifting, and offshore tax evasion, as well as analyzing suspected tax evasion cases."
* This article has been translated by AI.
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