On May 25, 2026, the South Korean National Tax Service (NTS) issued a stern warning to corporate owners and wealthy individuals exploiting a legal loophole: using company funds to purchase ultra-luxury supercars for personal use under the guise of business expenses. The message, delivered by NTS Commissioner Lim Gwang-hyun on X (formerly Twitter), signaled a new era of strict scrutiny and enforcement—a move that could reshape the country’s high-end auto market and corporate expense practices.
Commissioner Lim was unequivocal in his statement: “The National Tax Service is thoroughly analyzing the acquisition, operation, and expense processing of high-priced corporate vehicles. If personal use by the owner’s family is confirmed, we will conduct strict tax investigations.” According to Herald Economy, Lim further explained, “Some wealthy individuals have purchased multi-billion won supercars under company names and used them for family outings, golf, and entertainment, processing these as company expenses to evade taxes.”
This crackdown comes after years of mounting public frustration and repeated government efforts to curb such abuses. Back in 2020, a large-scale tax investigation revealed widespread misuse of corporate vehicles, prompting the introduction of the now-infamous green license plate system. From January 2024, all company-owned vehicles valued at over 80 million KRW were required to display these distinctive plates, making them easily identifiable and, in theory, deterring personal use. As reported by Tax Finance News, the green plates were meant to “make high-priced corporate vehicles easily identifiable and curb personal use.”
At first, the policy seemed to work. Registrations of corporate vehicles over 100 million KRW plummeted from 51,542 in 2023 to 33,960 in 2024—a dramatic 34% drop. But the effect proved temporary. By 2025, new registrations rebounded to 39,429, and the green plates themselves began to take on a new meaning. “Recently, the green license plate has become a symbol of asset owners rather than a deterrent,” Lim lamented on social media, as cited by Korea Economic Daily.
The NTS’s renewed focus comes amid a broader government push for tax justice. President Lee Jae-myung, during a cabinet meeting on May 20, 2026, openly criticized the practice of corporate luxury car purchases for personal use. “Are there still cases where the chairman’s son or grandson uses a luxury imported car for personal reasons?” he asked, calling for stricter oversight. Lim responded, “Driving a supercar with a different colored license plate has become a trend, a kind of flex. We will soon begin investigations.”
For years, the system allowed company owners and their families to enjoy the perks of ultra-expensive vehicles—sometimes costing tens of billions of won—while shifting part of the financial burden onto taxpayers. By classifying the purchase, fuel, insurance, and maintenance as company expenses, businesses could lower their corporate tax bills. As Newsis explained, “If a company spends 50 million KRW annually on vehicle maintenance, it can reduce its taxes by around 10 million KRW.” This arrangement, while legal in form, was often dubious in substance. Lim minced no words: “Buying a supercar with company money and processing it as a business expense means part of the cost is covered by the nation—by your taxes.”
Despite the crackdown, loopholes and creative accounting persisted. In some cases, entire fleets of supercars were registered to a single company, only to be used as personal vehicles by the owner’s family—including children. Past investigations uncovered not just vehicle misuse, but broader patterns of financial impropriety: false salary payments, luxury condo stays, and designer goods bought on the company dime. As Seoul Economic Daily noted, “The NTS sees personal use of corporate vehicles as a sign of broader corporate tax evasion risks.”
The government’s stance is supported by international precedent. Lim pointed out that in countries like the United States and the United Kingdom, even commuting in a company car is considered personal use and taxed accordingly. “Such acts are not just a moral issue but clear tax evasion,” he declared. “In major countries, company vehicles used for commuting are also taxed as personal use and strictly managed.”
The impact of these enforcement efforts is already being felt across South Korea’s supercar market. As demand from corporate buyers dwindles, luxury carmakers are shifting their focus to wealthy individual customers. According to Newsis, sales of imported supercars over 100 million KRW dropped sharply from 51,083 in 2023 to 35,320 in 2024, with only a partial recovery to 41,155 in 2025. Brand-specific declines from January to April 2026 compared to the previous year were stark: Lamborghini sales fell by 37%, Ferrari by 42.3%, Rolls-Royce by 13.8%, and Porsche by 20.7%.
Supercar brands are adapting by offering personalized services, track events, and private memberships to attract individual buyers. One industry insider told Newsis, “Corporate leasing once fueled market growth, but now pure personal purchases are increasing. As tax risks grow, the market is shrinking in quantity but evolving in quality.”
Meanwhile, the NTS’s new vigilance is sending ripples through the business community. The agency has made it clear that personal use of corporate vehicles is not a minor infraction but a red flag for deeper tax evasion. Companies caught in past audits faced significantly higher additional tax assessments than their peers. Lim underscored, “This is not just a one-off deviation, but a critical signal of overall corporate tax evasion risk.”
Some business owners argue that using company money for cars is harmless if they own the business outright. But as Tax Finance News countered, “Such arguments ignore the social role of corporations, which receive tax breaks and state support in exchange for contributing to employment and the economy.”
With the green license plate system now viewed as a status symbol rather than a deterrent, the government faces a new challenge: how to restore integrity and trust in the tax system. Lim emphasized, “This issue is important for tax justice and restoring normalcy to ensure fairness in society. We will ensure that not a privileged few, but the majority who follow the rules, are respected.”
As the government’s crackdown intensifies, the message is clear: the era of “flexing” with company-owned supercars may be coming to an end. For the NTS, it’s about more than just cars—it’s a test of corporate responsibility and public trust.