South Korea is intensifying its crackdown on wealthy business owners who use corporate-owned luxury vehicles for personal lifestyles, as authorities increasingly treat the practice as a visible symbol of tax avoidance and hidden wealth.
The country’s National Tax Service said it is launching high-intensity tax audits targeting luxury supercars registered under corporate names but allegedly used for family activities, golf outings and private leisure rather than legitimate business purposes.
At the center of the crackdown is one of South Korea’s most unusual regulatory tools: the “lime green” license plate.
Unlike many countries, South Korea classifies vehicle license plates by usage category and assigns different colors depending on whether a vehicle is privately owned, commercially operated or registered under a corporation.
Since 2024, any corporate vehicle priced above 80 million won, or roughly $60,000, has been required to display a highly visible lime green license plate intended to distinguish expensive corporate cars from ordinary private vehicles.
The policy was introduced after years of public criticism that wealthy individuals were purchasing imported luxury vehicles through their companies in order to deduct costs, reduce taxes and conceal personal consumption as corporate expenses.
South Korean tax authorities have increasingly argued that many of these vehicles function less as business assets and more as personal status symbols funded through corporate structures.
NTS Commissioner Lim Kwang-hyun announced on May 25 that authorities would expand forensic reviews of luxury corporate fleets, including purchase records, operating logs and expense filings.
“If suspicions of personal exploitation by controlling families are confirmed, we will rigorously execute tax audits,” Lim said.
The government’s message is increasingly clear: registering a luxury vehicle under a corporation does not shield owners from scrutiny if the vehicle is effectively being used as a private car.
Initially, the lime green plate policy appeared successful. Registrations of high-end corporate vehicles dropped from 51,542 units in 2023 to 33,960 units in 2024.
But the decline proved temporary.
Registrations rebounded to 39,429 units in 2025 as the lime green plates unexpectedly evolved into a new form of status signaling among affluent drivers.
“Recently, the lime green license plate has conversely come to be recognized as a symbol of wealth, indicating that the driver owns a corporation,” Lim said. “Consequently, purchases of high-priced vehicles under corporate names are on the rise again.”
The unintended cultural shift has complicated the government’s strategy. What was originally designed as a public deterrent against tax abuse has increasingly become associated with corporate prestige and visible wealth.
Tax officials argue the issue extends beyond optics and points to broader patterns of financial irregularities.
According to the National Tax Service, companies caught improperly deducting luxury vehicle expenses frequently showed signs of wider tax evasion and concealed income. Authorities say abuse of corporate-car deductions has become a useful indicator for identifying broader financial misconduct.
Lim emphasized that using company funds to acquire supercars for personal use is not simply unethical behavior but a direct form of tax evasion.
He also noted that several advanced economies maintain stricter standards for company-car usage, with some countries treating even commuting in a corporate vehicle as taxable personal use.
The issue has drawn attention at the highest levels of government.
During a cabinet meeting on May 20, President Lee Jae-myung reportedly questioned whether wealthy families were still exploiting the corporate-vehicle loophole, asking officials whether executives’ children and grandchildren continued using imported luxury vehicles for private leisure under company ownership.
Tax authorities acknowledged that the lime green plates had unexpectedly become a way for some drivers to openly “flex” wealth rather than conceal it.
The controversy reflects growing frustration in South Korea over wealth inequality, visible displays of affluence and perceptions that the wealthy can exploit corporate structures to reduce taxes while ordinary households face rising living costs and a slowing economy.
As South Korea expands oversight of luxury spending and inherited wealth, the country’s lime green license plates are increasingly becoming both a tax-enforcement tool and a public symbol of the widening debate over fairness in one of Asia’s most unequal asset markets.
