Advertisers are quickly cutting ties with Cha Eun Woo amid allegations that the star evaded $13.6 million in taxes.
Major brands began removing ASTRO member Cha’s image from their platforms on January 22nd. Shinhan Bank has made all commercial videos and images featuring him private on YouTube and social media. This move is especially ironic for the bank, which had chosen Cha as a ‘safe’ successor after their previous model, Kim Soo Kyun, was involved in a scandal with the late Kim Sae Ron.
Skincare brand Abib has also removed Cha’s campaign videos from YouTube and deleted promotional photos from its official accounts. Meanwhile, massage chair brand Bodyfriend is reportedly considering switching to non-celebrity models after February, though sources suggest this change was already being discussed before the scandal broke.
Industry insiders are closely watching other luxury brands Cha represents, including Saint Laurent, Calvin Klein, Norang Tongdak and LG Uplus, to see if they will follow suit.
The fallout comes from a report that the Seoul Regional Tax Office conducted a thorough tax audit on Cha in the first half of last year. Authorities found that he underpaid his taxes by over 20 billion won ($15 million), the largest tax amount ever for a Korean celebrity.
Authorities believe Cha tried to lower his taxes by funneling money through a company run by his mother. According to the investigation, Cha and Fantagio signed a contract with her firm for ‘entertainment support services.’ The NTS concluded that earnings were distributed to this corporation to benefit from lower corporate tax rates, avoiding the steeper 45% individual income tax rate.
Adding to the controversy are suspicions regarding the timing of his military service. Cha enlisted in the Army Military Band last July. Reports indicate that the NTS postponed sending the official tax audit notice at Cha’s request until his enlistment procedures were complete. This has fueled speculation that his enlistment may have been a strategic move to “flee” into the military before the scandal broke.
Cha’s agency, Fantagio, has pushed back, stating that the matter is not yet finalized. “We plan to clarify our position through legitimate procedures regarding the interpretation and application of the tax law,” the agency said. They added that Cha Eun Woo promises to fulfill his legal obligations as a citizen faithfully.
>> Cha Eun Woo Suspected of $13.6 Million Tax Evasion Through Mother’s Company, Agency Responds
Want to know which K-dramas are trending? Watch them for free on Amasian TV! Now streaming on Channel 250 (U.S.) and Channel 263 (Canada) via lgchannels.com, or anytime on OnDemandKorea.
Source (1)
