Kukkiwon Tax Investigation

From http://mookas.us/media_view.asp?news_no=1396


Testing Fee Tax Investigation Expected to Impact Leaders

Kukiwon Taekwondo testing fees incur a 'Profitable Business' tax investigation which will determine the fate of Kukiwon. The investigation began last September 8. and will continue with strong investigations until the 25th. According to the internal Kukiwon report, the IRS will investigate for the reasons, "Under the National Tax Law, Kukiwon prevents 'value-added tax' for the purpose of being a nonprofit organization, but the revenue it benefits from the testing fees and other fees received from applicants categorize the organization as a Profit Business", the Korean IRS said. Kukiwon has submitted a petition to Seo Byeong Su, head of the tax investigation. In the petition, it is stated that Kukiwon meet the Korean Standard Industrial Classification, and also the IRS has no evidence for the charges, and lastly that Kukiwon is a public interest organization to serve public good.A key Kukiwon official said, "After this tax investigation, IRS will go after KTA and city associations...,if testing fees force Kukiwon to be a Profit Business, same can be said for KTA and others. This can lead to economic loss and impact even the students". He added, "IRS needs to recognize that testing fees does not void the fact that Kukiwon is a nonprofit organization, for the purposes of public interest IRS should acknowledge the necessity of testing fees for business purposes, also an authoritative interpretation of testing fees as business profits should be repealed. In addition, the unfair tax investigation of Kukiwon must stop immediately", he said.This investigation is being closely monitored by the masters. One Kukiwon official said, "if testing fees require taxes, this will directly impact the TKD community, but mainly the Masters who run the dojangs". Grandmaster Han who has ran his dojang for over 10 years commented, "with the struggling economy, parents are already complaining about the testing fee of $120 (1 dan). If we need to impose additional fees, how can we not complain". TKD testing is the only business purpose Kukiwon holds, and they provide the registration certificates which include: registration fee of $7.10 (1 dan), KTA referral fee of ($2.60). Other organizations charge $7.80 for testing fee, but you have to include gym fees and training fees.