Anchor: The National Tax Service has launched a tax probe on Google Korea amid controversy that many multinational IT firms in the nation are not paying enough taxes compared to the profits they reap. 
Our Bae Joo-yon has more on whether it’s possible to impose further taxes on such companies. 

Report: National Tax Service inspectors secured account books and electronic data Wednesday from the Seoul headquarters of Google Korea. 

Some market observers say the inspectors are probing tax evasion allegations involving high-income content creators on YouTube, the global video streaming service owned by Google.

Others say authorities are probing whether Google Korea may be involved in offshore tax evasion. 

The probe comes amid controversy that Google Korea has been paying too little taxes. 

As of 2016, Google Korea reaped around 300 billion won in sales and is known to have paid around four billion won in corporate taxes. Meanwhile, Google’s head office is estimated to have posted nearly five trillion won in sales in South Korea. 

The tax agency is likely to focus on determining whether Google Korea’s income and expenditure were appropriately recorded and whether transaction fees with the head office were proper. 

However, distinguishing Google Korea’s domestic transactions from its dealings with the head office may prove challenging. Moreover, it is not possible to directly tax Google under current laws given that it has no servers in South Korea. 

This is why multinational IT firms like Google operating in South Korea only pay value added tax corresponding to products they sell in South Korea. 

The National Assembly recently passed a bill that seeks to expand the scope of international IT firms’ products that are subject to value added tax. 

Once that scope is expanded, efforts to accurately estimate sales that Google recorded in South Korea will become easier. 

Separately, Google Korea is facing another probe by the Fair Trade Commission on allegations it abused its dominant position in the market in dealings with a South Korean game company. 
Bae Joo-yon, KBS World Radio News.