Advertisements by tax consultants that claim refund rates, tax savings, or success rates without proper justification are now prohibited. Promotions that assert superiority, such as 'the best in the country' or 'number one in refund rates,' are also subject to regulation.
The National Tax Service announced on August 20 that it will issue a notice regarding the 'Regulations on Advertisements Prohibited for Tax Consultants.'
This notice specifies types of advertisements that could harm taxpayers, following amendments to the Tax Consultant Act made in December of last year. The regulations apply a 'principle of prohibition with exceptions' approach, allowing advertisements that present objective data while restricting misleading or exaggerated claims.
Prohibited advertisements include those that directly compare fees with other tax consultants and those that promise monetary or economic benefits. Expressions emphasizing superiority, such as 'the best in the country,' 'industry leader,' or 'number one in refund rates,' are also banned.
To advertise refund rates, tax savings, or success rates, consultants must provide statistical justification. Advertisements that do not disclose the sample size, statistical period, or calculation methods are prohibited.
Advertisements that accurately display one's fees or performance based on objective data are permitted. Supporting documents and statistical justifications must be retained for three years from the date of advertisement publication or transmission.
The regulations apply to tax consultants and firms, as well as lawyers and certified public accountants registered for tax representation, including foreign tax advisory firms known as 'American tax consultants.'
The same standards will apply to advertisements created by tax consultants themselves and those produced and posted by other entities or individuals in the name of tax consultants. This measure ensures that consultants cannot evade responsibility by outsourcing advertisement production.
The National Tax Service plans to finalize the notice after gathering public and organizational feedback during the administrative notice period. It will establish a reporting channel for advertisements on its website and collaborate with organizations like the Korean Tax Association and the Korean Institute of Certified Public Accountants to strengthen monitoring and enforcement of violations.
* This article has been translated by AI.
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