National Assembly Introduces The “Cha Eunwoo Prevention Act”

Cha Eunwoo is facing a huge tax evasion controversy involving ₩20 billion KRW (about $13.8 million USD).

The controversy began with a high-intensity investigation by the Seoul Regional Tax Office’s 4th Investigation Division. The National Tax Service issued him a tax claim of over ₩20 billion, one of the largest ever on an entertainer. Cha Eunwoo’s team has requested a tax review to contest the claim.

Soon after, Jeong Yeon Wook, a People Power Party member, announced a proposal for the so-called “Cha Eunwoo Prevention Act.” The bill would tighten regulations on entertainment agencies, forcing them to report their status annually to the Minister of Culture, Sports and Tourism.

This amendment also aims to ban anyone fined or sentenced under the Punishment of Tax Crimes Act from running or working at planning agencies. Previously, only sex offenders and child abusers faced restrictions.

Jeong Yeon Wook said:

“While K-content is leading the global market, the management system for agencies remains outdated. We can no longer tolerate institutional loopholes that allow individuals with prior tax evasion records to openly engage in planning businesses.”

“Stop hiding behind the excuse of leaving it to local governments; take direct responsibility for management and supervision.”

“This bill is a minimal device to enhance industry transparency and accountability to establish a fair order.”

Fantagio, Cha Eunwoo’s agency, clarified on January 22 that the issue centers on whether a corporation run by his mother qualifies as a substantial taxpayer.

“This issue primarily concerns whether the corporation established by Cha Eunwoo’s mother qualifies as a substantial taxpayer. It is not a finalized or officially notified matter, and we will actively provide explanations regarding legal interpretations and application issues through proper procedures.” — Fantagio

They also said:

“The artist and tax representatives will sincerely cooperate to promptly conclude the relevant procedures. Cha Eunwoo pledges to faithfully fulfill his tax reporting and legal obligations as a citizen.”

Cha Eunwoo himself posted an apology on January 26, writing:

“I am currently serving in the military, but this controversy was never a deliberate choice to avoid it. Last year, I reached a point where I could no longer postpone my military enlistment, so I enlisted without concluding the tax investigation. I will faithfully attend to the ongoing tax procedures and humbly accept any final decisions made by the authorities, taking responsibility accordingly.”

Fantagio followed up with a second statement on January 27:

“We feel a heavy responsibility for the controversy involving the company and our artist. The ongoing issue is currently under fact verification by tax authorities, and both the agency and the artist are fully cooperating within their respective capacities.”

“Should legal or administrative judgments become clear going forward, we will responsibly implement necessary measures based on the outcomes. However, we strongly urge the public to refrain from reckless speculation, the spread of unverified information, and excessive overinterpretation regarding the claims and suspicions raised.”

As the situation develops, Jeong Yeon Wook’s proposed amendment aims to tighten controls on the entertainment industry’s tax issues – inspired directly by the Cha Eunwoo tax case.

This bill targets a major loophole – meaning entertainers and agency staff caught for tax crimes could face industry bans.

Fans and the industry are monitoring the controversy closely.

Image: Cha Eunwoo during a press event (credit: Fantagio)

Embedded Tweet from Jeong Yeon Wook:

“We can no longer tolerate institutional loopholes that allow individuals with prior tax evasion records to openly engage in planning businesses. The ‘Cha Eunwoo Prevention Act’ will put transparency and accountability first.”

Embedded YouTube Video: Fahionable Cha Eunwoo’s latest interview addressing the controversy