Group ASTRO member and actor Cha Eun-woo is facing allegations of tax evasion involving around 20 billion won, and another advertiser has chosen to cut ties and distance itself.
On the 27th, OSEN confirmed that SSG.com changed to private the advertising videos of Cha Eun-woo, whom it had selected as the exclusive model for its beauty specialty section, on its YouTube channel. The video currently shows only the messages "This video cannot be played" and "This is a private video," and although SSG.com did not explain the reason for making it private, the move is significant because it came immediately after the tax evasion allegations arose.
When SSG.com selected Cha Eun-woo as the exclusive model for its beauty specialty section, SSG.com said, "Actor Cha Eun-woo's sophisticated and trustworthy image matches SSG.com's image, so he will join us as a beauty model," and "From luxury to emerging indie brands, we will become the cosmetics hotspot that introduces buzzworthy products first."
The Seoul Regional Tax Service's Investigation Division 4 last year conducted a high-intensity investigation into Cha Eun-woo over allegations of tax evasion through a one-person agency established by his mother. Cha Eun-woo had been active with his agency Fantagio and the one-person agency set up by his mother signing a service contract to support his entertainment activities, and income was known to have been shared among Fantagio, the one-person agency and Cha Eun-woo, but the tax office viewed the one-person agency set up by Cha Eun-woo's mother as a paper company that did not actually provide services.
The tax office judged that Cha Eun-woo and his mother set up a corporation and divided income to reduce income tax by as much as 45%, using a scheme that applied the corporate tax rate, which is 20 percentage points lower than the income tax rate, and Cha Eun-woo's side said, "The main issue in this matter is whether the corporation set up by Cha Eun-woo's mother is subject to substantive taxation, and this is not a matter that has been finally confirmed or notified. We will actively explain the issues related to legal interpretation and application through proper procedures. The artist and the tax representative will sincerely cooperate so that the procedure can be completed promptly," it said.
Cha Eun-woo said, "I sincerely bow my head and apologize for causing concerns and disappointment to many people due to various recent matters related to me. Taking this opportunity, as a citizen of Korea I am reflecting deeply on whether my attitude toward the duty to pay taxes was sufficiently strict," and Fantagio also said, "Taking this opportunity, we will once again check the artist management system, supplement and strengthen necessary systems, and do our best to prevent similar controversies from recurring," offering an additional statement.
SSG.com's decision to cut ties with Cha Eun-woo is not the first in the advertising industry. Earlier, skincare brand Abib changed Cha Eun-woo's advertising videos and posts to private, and Shinhan Bank, Marithé François Girbaud and Daesung Mymac took the same measures. The Defense Media Agency's YouTube channel "KFN Plus," which the agency operates, also changed to private the video in which Cha Eun-woo appeared as a storyteller on "Stories from that day in the military."
[OSEN]