Cha Eun-woo, a member of the group Astro and an actor, said regarding the tax audit controversy that he would "actively explain in accordance with due process."
Agency Fantagio issued an official statement on the 22nd, saying, "Nothing has been finally decided or notified at this time, and we plan to actively explain, in accordance with due process, the issues regarding the interpretation and application of the law."
The agency also said, "The main issue in this matter is whether the corporation established by Cha Eun-woo's mother falls under the actual taxpayer," and added, "The artist and the tax agent will faithfully cooperate so that the procedure can be concluded as soon as possible."
It added, "Cha Eun-woo's position is that, as a citizen, he will continue to faithfully fulfill his tax filings and legal obligations."
According to a report by Edaily on the same day, the National Tax Service notified Cha Eun-woo of a tax assessment exceeding 20 billion won, including income tax. The part flagged by the National Tax Service is Cha Eun-woo's income structure. A corporation A, established by Cha Eun-woo's mother, and agency Fantagio signed a service contract under the pretext of supporting Cha's entertainment activities, and the revenue was then divided among Fantagio, corporation A, and Cha Eun-woo personally.
The National Tax Service is said to have determined that corporation A corresponds to a "paper company" that did not provide actual services. It said income that should have been attributed to the individual was dispersed to a corporation to avoid the income tax rate of up to 45% and instead apply the relatively lower corporate tax rate.
Cha Eun-woo's side, however, is disputing this determination. Corporation A's side said, "As Fantagio's CEO changed multiple times, there were significant concerns about the stability of entertainment activities, and to protect that, the mother directly came to run the management business," adding, "Corporation A is a company formally registered as a popular culture and arts planning business and is not an insubstantial paper company."
Meanwhile, Cha Eun-woo applied to the Ministry of National Defense military band in May last year and was finally accepted, and he has been serving since July of the same year. His scheduled discharge date is Jan. 27, 2027.