South Korea has managed to reduce undervalued imports through the SIREN system, according to a report by the World Trade Organization (WTO).
Between 2016 and 2020, 172.2 billion was collected in KRW (South Korean won) on undervalued imports, up from KRW 99.4 billion in the period 2012-2015.
Currently, the SIREN 2007 system, a Korean Customs Service (KCS) immediate alert system, is still in effect to block undervalued imports of agricultural products, plants and fishery products.
Based on the results, undervalued products are audited, while normal products are dispatched quickly.
So the SIREN system appears to have increased tax revenues and also prevented the undervaluation of products.
Customs duties (including internal taxes) must be paid within 15 days of acceptance of the import declaration (when a guarantee has been provided).
The delay in payments gives rise to a surcharge of 3% of the amount owed for the first month, and 0.0025% for each of the following days (up to a maximum of 60 months).
Likewise, fraudulent declarations of taxable value, false tariff rates or incorrect tariff classification with the intention of altering the determination of the duty to be paid are punishable by criminal penalties (up to three years in prison with “forced” labor, or a fine equivalent to a maximum of five times the amount evaded or the cost of the goods in question).
Sanctions are also applied in relation to imports of articles as components and other unfinished, incomplete or finished articles that have important characteristics as partial components in order to avoid the import restrictions provided for in the law.
At the same time, administrative decisions can be appealed to the KCS, the National Tax Court or the Board of Audit and Investigation.
In this case, the Customs Appeals Committee, made up of five internal KCS members and six external experts, makes a decision after in-depth review. It is possible to sue your decisions.
To conclude, in 2020, in order to protect the rights of taxpayers and help them solve unresolved problems through tax appeals, the KCS established a taxpayer defense service, which included a taxpayer advocate and a commission. defense of the taxpayer, effective as of July 1, 2020.