Cha Eun-woo faces tax evasion allegations of $13M, ad campaigns suspended amid scrutiny

South Korea’s National Tax Service reportedly issued Cha with a substantial additional tax assessment last year

Several South Korean brands have suspended or scaled back advertising campaigns featuring actor and K-pop star Cha Eun-woo following allegations that he avoided more than 20 billion won (US$13 million) in taxes through a company registered under his mother’s name.

Banks and consumer-facing brands, including Shinhan Bank and skincare label Abib, have set advertisements featuring Cha to private on their social media platforms. Wellness company BodyFriend is also reviewing whether to replace him in future promotional material, according to local media reports.

The developments follow reports that South Korea’s National Tax Service last year issued Cha with a substantial additional tax assessment. Authorities reportedly concluded that a company established by his mother operated as a paper firm.

According to Edaily, the entity entered into an agreement with Fantagio, Cha’s agency, to manage his entertainment activities, after which income was distributed between Fantagio, the company and Cha himself.

Tax officials are said to have determined that the arrangement enabled earnings to be channelled in a way that reduced Cha’s overall tax burden by more than 20 percentage points. Cha has since filed for a pre-assessment review, a formal process allowing taxpayers to dispute a tax authority’s interpretation before a final ruling is made.

Fantagio said it “will actively clarify its position through appropriate legal procedures concerning the interpretation and application of tax law”. The agency added that “the key issue is whether a company established by Cha’s mother qualifies as a legitimate subject of taxation”. It also stated that Cha “will continue to faithfully fulfil all tax reporting and legal obligations as a law-abiding citizen”.

Fantagio itself reportedly received an additional tax bill of 8.2 billion won last year in connection with the case.

Cha, a member of the idol group Astro, is known for television dramas including My ID is Gangnam Beauty and Rookie Historian Goo Hae-ryung. His case comes amid a broader tax crackdown in South Korea targeting high-income individuals. Last year, several prominent actors were ordered to pay billions of won in additional taxes following reviews of their filings.