SM Entertainment’s Co-CEO Lee Sung Soo Accuses Lee Soo Man Of Evading Taxes
Lee Sung Soo alleged that Lee Soo Man had set up a foreign business entity to evade taxes.
On February 16, K-Pop awoke to a bomb set off by SM Entertainment Co-CEO Lee Sung Soo. On this day, the executive released a damning YouTube video in which he makes several accusations pointed towards Lee Soo Man, with one of them being that Lee Soo Man had set up a foreign business to evade paying taxes.
In the video, Lee Sung Soo reveals that in 2019, Lee Soo Man created a business entity in Hong Kong named CTP (CT Planning Limited). Lee Sung Soo claims CTP is an overseas version of Lee Soo Man’s domestic consulting business, Like Planning (translated), which has received ₩149 billion KRW (about $116 million USD) from SM Entertainment since its inception 22 years ago.
Although it is known that Like Planning has been paid a percentage of the revenue generated by SM Entertainment’s artists, Lee Sung Soo alleges that the way in which the revenue is distributed is peculiar.
Normally, it is customary for SM Entertainment to pay Like Planning its 6% fee from the settled amount (net) that SM Entertainment would receive after distributing profits between the labels. However, Lee Soo Man had ordered that contracts be made with the other labels so that he could take 6% of the revenue before it was distributed.
— Lee Sung Soo
Lee Sung Soo then alleges that Lee Soo Man did this in order for him to evade paying taxes.
Wouldn’t he have done this in order for him to evade the Internal Revenue Service of Korea? The contract between SM Entertainment and Like Planning was deemed invalid in both 2014 and 2021 and resulted in SM Entertainment paying back trillions of KRW in back taxes.
— Lee Sung Soo
Lee Sung Soo then alleged that Lee Soo Man’s business entity CTP was created to evade paying taxes in Korea.
I would like to question whether the profits generated by CTP through unsubstantiated means aren’t a classic case of offshore tax evasion. Due to CTP taking 6% from each label preemptively, CTP’s cut is twice as large as that of Like Planning.
— Lee Sung Soo
Watch the full video in the link below.
