South Korea’s National Tax Service imposes additional taxes totaling 178.5 billion won on 14 oligopolistic food companies, including OB Beer, for passing illicit rebate costs and excessive fees onto consumers via elevated product prices. Officials reveal the penalties on the 9th following extensive audits.
Audit Results Target Major Players
Investigators audit 103 companies since last September, conducting detailed examinations on 53 firms. These efforts yield the 178.5 billion won in surcharges. Approximately 150 billion won targets three dominant companies in ramen, ice cream, and soju production.
OB Beer’s Price Hikes and Rebate Practices
OB Beer, renowned for its Cass lager, raises consumer product prices by 22.7% over the past five years. During this period, the brewer distributes 110 billion won in rebates to retailers, accounting for 16.4% of its advertising expenditures. The company also overpays affiliates more than 450 billion won in fees.
Tax officials determine these improper rebate outlays and surplus payments transfer directly into higher product prices.
Ice Cream Sector Under Fire
A leading ice cream distributor increases prices on primary products by 25% across the same five-year window. Probes uncover overpayments exceeding 250 billion won in logistics expenses to affiliated entities.
Broader Industry Violations
A memorial park operator hikes usage fees by 20% over five years. Reviews expose that 97% of its yearly sales derive from related-party dealings.
Another firm inflates reporting on labor costs, commission fees, and similar expenses, per investigation outcomes.
