Kim Jung-kyu, chairman of Tire Bank, has been sentenced to three years in prison for tax evasion involving concealed ownership of sales points. Although the total amount of tax evasion was reduced due to the expiration of the statute of limitations on some charges, the penalties remained significant.
On June 2, the third criminal division of the Daejeon High Court, led by Judge Kim Byeong-sik, overturned the previous ruling and sentenced Kim to three years in prison and a fine of 14.1 billion won for violations of the Act on the Aggravated Punishment of Specific Crimes (tax offenses). The court ruled that some amounts should be dismissed due to the expiration of the statute of limitations, in accordance with the Supreme Court's directive.
Kim was indicted in October 2017 for allegedly evading approximately 8 billion won in comprehensive income tax by disguising the ownership of some Tire Bank sales points as being operated by individual owners. He reportedly used methods such as underreporting cash sales and minimizing transaction details.
Additionally, he faced charges for issuing and receiving false tax invoices, despite having a de facto employment relationship with the consignment sales point operators. He was also accused of evading around 90 million won in capital gains tax from stock transfers.
In January 2019, the first trial court found Kim guilty and sentenced him to four years in prison and a fine of 10 billion won. However, the court did not enforce immediate detention at that time, citing the need to protect Kim's right to defense.
Following an administrative lawsuit, the initially reported tax evasion amount of 8 billion won was reduced to 5.5 billion won. During the appeals process, additional evidence submitted by Kim's defense team further adjusted the acknowledged tax evasion amount to 3.9 billion won.
However, the second trial court overturned the not guilty verdict on the false tax invoice charges, which had been deemed innocent in the first trial. As a result, in July of last year, the appellate court sentenced Kim to three years in prison and a fine of 14.1 billion won, leading to his immediate detention in court.
In a subsequent appeal, the Supreme Court overturned the previous ruling in January and sent the case back to the Daejeon High Court. The court indicated that some amounts from the total of 3.9 billion won in tax evasion for the years 2008 to 2015 should have been dismissed due to the expiration of the statute of limitations.
Consequently, the final acknowledged tax evasion amount in this retrial was reduced to 3.15 billion won. Nevertheless, the court rejected all other grounds for appeal raised by Kim's defense team, maintaining the sentence of three years in prison and a fine of 14.1 billion won.
* This article has been translated by AI.
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