Terraform labs have been fined $78M for tax evasion by South Korean authorities. The timing of this couldn’t have been worse, as they have already been trying to recover from the collapse of Luna and UST. However, an important question here is the fact that the company was dissolved by Do Kwon a while back. So, it’s difficult to say how things will work out.
Terraform labs fined $78M for tax evasion
All eyes are fixated on Terraform labs as the most significant collapse of the crypto industry took place a few weeks back. Reports suggest that there might be congressional hearings on the case and the investigation for tax evasion. This is because South Korean laws say that if the decision-making of a foreign company is happening locally, it would be considered a domestic company.
This is why the company has been fined a whopping 100 billion won or $78 million for tax evasion. There are rumors that the main reason why Do Kwon liquidated the company was the taxation system of South Korea. They were unhappy with the laws there, and it seemed that the company was liquidated just before the crash, making it look fishy.
This is not the first time that the company has been fined. Back in October 2021, Virgin Islands Subsidiaries of Terra were fined $34.7 million in corporate tax and $3.6 million in income tax.
Do Kwon summoned by South Korea’s parliament
The collapse of Luna and UST has led the South Korean parliament to summon Do Kwon. This happened after he announced a plan to relaunch the ecosystem of Terra. So, the authorities might be interested in how he plans to help everything recover or what the plans are. The question of investors’ protection would also be taken up in the parliament hearing. Do Kwon might have to answer how he plans to cut down the losses of investors. This is very important as exchanges are halting Luna trading, which is further adding to the huge losses of investors.
What are your thoughts as Terraform labs were fined $78M for tax evasion? And do you think that Do Kown dissolved the company because of tax laws, or there was something fishy going on with the crash? Let us know in the comments below. Also, if you found our content informative, do like and share it with your friends.