A user of an online second-hand trading platform has made more than 400 second-hand transactions since joining the platform last year. This user, who sells new, unopened products ranging from luxury watches of millions of won to home appliances at a lower price than the market, also sells 2-3 products of the same model. More than 100 posts were posted by this user to sell used products.
The government is considering a plan to impose a tax on businesses selling products disguised as used transactions for the purpose of tax evasion. The reason is that as the second-hand market has rapidly expanded due to the activation of the second-hand trading platform, more and more business operators are using it to evade tax. According to the Ministry of Strategy and Finance and the National Tax Service on the 3rd, the government is reviewing a plan to include such amendments to the VAT Act to be announced this month.
The key to the revision of the VAT Act is to provide a basis for the government to request the submission of data such as user transaction details, such as used trading platform companies. Through this, users disguised as interpersonal transactions are selected and the business operators are required to pay taxes.
According to the current law, all businesses that sell products or provide services for business are required to report and pay 10% VAT. If you have business income, you must report and pay global income tax (6-45%), which is levied on global income, along with labor, interest, and dividends. However, there are currently no sanctions for businesses to repeatedly sell expensive items through second-hand trading platforms and pay taxes. This is because there is no tax on the form of second-hand transactions between individuals.
According to the Korea Internet & Security Agency, the domestic second-hand market has grown sixfold from 4 trillion won in 2008 to 24 trillion won in 2021. As the second-hand trading platform is activated, the number of users increases rapidly. The online second-hand trading platforms ‘Jonggonara’ and ‘Carrot Market’ have 22 to 25 million members.
Last year, during the National Assembly audit by the National Tax Service, even luxury goods and gold bars priced at tens of millions of won on the used trading platform were frequently traded, pointing out the taxation blind spot.
The three second-hand trading platforms, Carrot Market, Bangbang Market, and Jungjungnara, recently informed the current laws to operators or users who are presumed to be business operators at the request of the National Tax Service. The notice said, “If you are a mail-order business when using second-hand transactions, you are obliged to register as a business, issue cash receipts, report and pay taxes as stipulated by the tax law.” ” was included.
However, it is reported that the government is contemplating how to establish a taxation system as second-hand transactions take place in quite a variety of forms. Currently, transactions using second-hand trading platforms are the most common, but there are areas that the government’s administrative power cannot reach, such as internet cafes and resale (resale). A government official explained, “It is true that it is not easy to come up with a law that covers various types of transactions.” Basically, it seems that the tax authorities will decide whether a second-hand transaction user is a business operator or not, depending on whether the transaction is continuous or repeated, which is the main principle of business judgment under the VAT Act. However, as second-hand transactions have become quite common, there is a possibility that additional specific standards such as sales amount and number of transactions may be prepared.
An official from the National Tax Service explained, “The amendment will be in the direction of securing transaction data and providing guidance (to the user concerned).” According to the industry, the National Tax Service is also watching resale brokerage platforms such as ‘Cream’ and ‘Soldout’.
[전경운 기자 / 안병준 기자 / 홍성용 기자]
[ⓒ 매일경제 & mk.co.kr, 무단전재 및 재배포 금지]
