Terra (CRYPTO: LUNA) founder Do Kwon has reportedly been ordered to pay 100 billion won or $78 million in taxes by South Korea’s National Tax Service.
What Happened: According to a report from local news outlet Naver, the country’s tax authorities found Terra’s parent companies – The Ancore Company and Terraform Labs – guilty of evading corporate and income tax.
ENTER TO WIN $500 IN STOCK OR CRYPTO
Enter your email and you'll also get Benzinga's ultimate morning update AND a free $30 gift card and more!
The authorities discovered that Terraform Labs sent LUNA from its Singapore-established entity to the Luna Financial Guard (LFG) and determined that the transfer was done to avoid taxes.
Despite LFG and Terraform Labs being established in Singapore, South Korean tax authorities ruled that they are subject to domestic taxes based on the “place of actual management.”
See Also: IS TERRA (LUNA) DEAD?
Do Kwon reportedly holds a 92% stake in Terra Singapore, with the remaining 8% belonging to another South Korean national Shin Hyun-seong.
The report also states that an additional tax may be imposed on the Bitcoin (CRYPTO: BTC) acquired and sold by the LFG.
Price Action: According to data from Benzinga Pro, BTC was trading at $28,700, down 5% in the last 24 hours. The leading digital asset fell to a low of $26,350 last week after the collapse of Terra’s stablecoin TerraUSD (CRYPTO: UST).
The second-largest cryptocurrency by market cap Ethereum (CRYPTO: ETH) was trading at $1,900, down 7% in the last 24 hours.
Photo courtesy: Terra