Screwing Over the Korean Chaebols (2)
"Ah..., I apologize. I’ve overstepped my bounds with that unsolicited advice."
Yoon-gi shook his head at Kang Seok-ho, who was bowing his head. "No, on the contrary, it’s excellent advice. It’s surprisingly easy for people to overlook the simple things. I welcome such advice anytime."
"Thank you for understanding." As Kang Seok-ho’s face brightened, Yoon-gi continued his explanation.
"Actually, I’m well aware of which types of donations are a way to save money. The best way to save money is through physical goods, after all."
"As expected..., you’ve already grasped it all."
"Of course. That’s how one makes money."
Many people probably know this through the news or the internet: the methods corporations use to save on taxes through donations. The most representative example is dumping food inventory that has only one day left until its expiration date onto orphanages or nursing homes. These companies usually provide a small amount of support to those facilities, and by dumping this stock there, they receive a receipt for the donation.
Even if it’s a product with only one day left, its value is considered the same as products currently on the market. If a company had to dispose of the goods, it would cost 100, but by processing it as a 'donation,' they can reduce the cost to almost 10 or 20. This applies not just to food, but to all kinds of physical assets, including outdated electronic products.
However, Yoon-gi’s operation of the Hope Foundation was strictly a cash-based system. Of course, he could process food produced by YK Samgang as donations, but fundamentally, it was a method that only incurred costs.
But. In the past, in the 80s, and even in the 2010s, foundations under corporate umbrellas like the Hope Foundation have always existed. Why do they exist? Because the companies are idiots? No.
"Secretary Kang."
"Yes, Chairman."
"These foundations are basically used for tax evasion during inheritance."
Yoon-gi actually had no interest in foundations. Therefore, he didn't know much about the inheritance tax evasion methods of other corporations. However, as he thought about setting up a system after opening the orphanage, he began to research foundations and learned why they were established. And Yoon-gi came up with a strategy that would be of great help to YK in the future.
"Yes, that’s correct. That is the very reason for a foundation’s existence. For starters, the way to 'effectively trade' a multi-billion won house without paying gift tax is through a foundation."
A father donates a multi-billion won house to a foundation. Then, the foundation sells the donated house to the son at a lowered price. In this case, no gift tax is incurred. Of course, by the 2010s, many of these methods would become unusable, but this was the 80s. These loopholes were being utilized to an incredible degree.
The gift tax that a multi-billionaire should pay is basically over 50 percent. These loopholes were exactly what allowed this 50 percent, which should have been returned to society, to be inherited instead of going to the public.
'I’ve felt this for a long time, but I don’t understand commoners who worry about the inheritance taxes of the rich. It’s not like the rich give them money if they get an inheritance tax exemption.'
Of course, he knew that this behavior was the result of the hope that 'someday, if I become rich,' but the moment one is born as a 'dirt spoon,' even becoming a 'silver spoon' is nearly impossible. Even if a dirt spoon manages to get a job at a large corporation and is lucky enough to work until retirement, the total money they can earn in their lifetime doesn't even reach 3 billion won, based on the 2010s.
"So, here’s the question, Secretary Kang. What do you think is YK’s strength?"
"YK’s strength, you say?"
"You have plenty of time to think, so think carefully."
Yoon-gi smiled and waited for Kang Seok-ho’s answer.
'YK’s strength? That’s obviously the Chairman, but he definitely wouldn't be asking if he wanted that kind of answer...'
In Kang Seok-ho’s opinion, Yoon-gi was not the type to crave flattery. Of course, that didn't mean he disliked praise. It just meant that a subordinate who only flattered had no merit to Yoon-gi.
'There must be a clue in my conversation with the Chairman right now... The topic of foundations came up, the topic of donations came up, and even the topic of YK came up. If so...'
Kang Seok-ho was competent. As such, through a rapid thought process, he provided the correct answer to Yoon-gi.
"It is that the people who form the core are young."
"Exactly!"
Kang Seok-ho felt very proud at Yoon-gi’s satisfied expression. It was a rare one-on-one meeting with Yoon-gi, and he had received a passing grade.
"As Secretary Kang knows, the executives of our YK are basically young on average. Of course, there are cases like President Jung Dong-yoon or President Kim Jung-sun, but if you look at the core—Secretary Ryu, my uncle, and you, Secretary Kang—you are clearly young, aren't you?"
"In addition, the Chairman is also very young."
Flattery at the perfect timing is truly an art. That was why Yoon-gi also wore a satisfied expression.
"That’s right, we are young. And our YK is still a group with huge growth potential."
"I think so too."
"Then, one point of differentiation from other chaebols arises."
"That is 'inheritance'."
Clap, clap, clap, clap! Yoon-gi clapped his hands and nodded.
'Bravo!'
Kang Seok-ho felt like he wanted to jump for joy. He had already scored high twice just today. It was obvious how this high score would affect his future.
"What would happen if we blocked the loophole inheritance through foundations in advance?"
"The power of other chaebols will be weakened. The value-added tax that should have been accumulated through inheritance will be returned to the people."
"That’s right. That is why I intend to amend the laws through JD."
Here, Kang Seok-ho returned to reality.
"Certainly, if it succeeds, it will be a law that helps our YK tremendously. But, will it really be easy? It’s uncertain if JD will listen, and the other chaebols won’t just sit idly by."
"Well, you never know until you try. Just as you have to go out to sea to find a new continent, you can’t gain anything if you don’t challenge yourself."
"Understood. Then, what should I do?"
"Nothing."
"Pardon?"
For a moment, Kang Seok-ho thought he had misheard. He had been called in, and even tested. Yet, there was nothing for him to do.
'Did I make a mistake somewhere?' Kang Seok-ho thought about everything that had happened since he arrived here, but no matter how much he thought about it, nothing came to mind.
"I called you here today to confirm my thoughts. And there is one more reason."
"What is that?"
If he wasn't being given a task, why was he called?
"Secretary Kang."
"Yes, Chairman."
"The Soviet Union and Vietnam. Which one do you want?"
***
"Pardon?"
Even for the highly intelligent Kang Seok-ho, his brain stopped for a moment. The Soviet Union and Vietnam? What was he supposed to think of these two?
"Ah, was I too fast? It’s simple. When YK expands overseas in the future, I intend to entrust one country to Secretary Kang. Not just as an employee, but almost at a partner level. Since you brought your personal file to me, trusting me, shouldn't I at least do that much?"
It was an incredibly unconventional treatment. Of course, YK hadn't yet expanded into Vietnam or the Soviet Union. However, looking at Japan, which could be considered effectively entered, Yoon-gi’s capability was truly beyond imagination. Even for the unentered regions of the Soviet Union and Vietnam, one had to assume that the moment Yoon-gi entered, the possibility of success would be very high.
"To go that far for me..."
"No, I’m actually more moved that you went that far for me, Secretary Kang. It’s hard to make that kind of choice. Since you were the only one who made that choice, it’s just a reward for it."
Secretary Kang forcibly held back the moisture welling up in his eyes and sank into judgment in his mind.
'The Soviet Union is communist. And it’s a closed place. But, given that the Chairman mentioned the Soviet Union, he is clearly confident in entering it. On the other hand, Vietnam is currently in the process of exchange, and the No. 1 domestic chaebol has just entered it. If I go there, I have to compete with the No. 1 domestic chaebol...'
Vietnam, where another chaebol was already pioneering, and the Soviet Union, an unchartered territory. Kang Seok-ho finally made a decision on the scales in his heart.
"I will choose the Soviet Union."
Kang Seok-ho was surprised at his own answer. For a moment, Yoon-gi’s expression had been filled with pure admiration.
"Chairman?"
That expression vanished quickly. Instead, a smile took its place.
"Good, let’s decide on the Soviet Union."
"I ask this daringly, but do you have a plan?"
"It wouldn't be fun if I told you now."
Seeing Yoon-gi’s smirk, Kang Seok-ho felt a sense of strong trust for some reason.
***
"Oh my, welcome!"
At JSD’s hospitality, Choi Ki-hyun bowed his waist slightly with a smile. If he used to have to bow more than 45 degrees every time he met JSD, now he only needed to bow about 15 degrees. Furthermore, their seating was now face-to-face. In the past, JSD sat in the seat of honor, but now it had become natural for them to sit facing each other on 3-person sofas.
"Have you been well?"
At Choi Ki-hyun’s words as he sat down, JSD nodded.
"Of course. Thanks to you, I’m doing very well. I used to live while being wary of the Heo clan, but these days, that doesn't happen much."
"That’s a relief. I’m also relieved to hear that you are so comfortable, Chief."
While they were exchanging pleasantries, JSD brought up the main point first.
"Come to think of it, what brings you here today? Surely you didn't just come to see me, right?"
At JSD’s smirk, Choi Ki-hyun wore a smile filled with apology.
"I apologize, but that’s not the case. Next time, I will come only to see you, Chief."
"No, no. Hahaha! But if you didn't come to see me, what brings you here?"
"I have a matter to suggest to His Excellency, and I came to receive your prior approval, Chief."
"Prior approval from me? By now, the Chairman should be fully capable of a one-on-one meeting with His Excellency, right?"
At JSD’s words, Choi Ki-hyun shook his head.
"I have always held you in the highest regard, Chief. The very reason I am in this position today is entirely thanks to you. Therefore, I do not want to cause any trouble for you with the work I do."
At Choi Ki-hyun’s words, JSD wore an expression full of being moved.
"You still treat me like that..."
JSD already knew that JD had encouraged Choi Ki-hyun to enter politics. Yet, Choi Ki-hyun was so respectful to him that he couldn't help but be moved.
"What do you mean 'still'? Our connection will continue even after I go to the grave. My grandson and your son will continue that connection."
"Thank you..."
At the sight of JSD choking up and trailing off, Choi Ki-hyun wore a benevolent smile.
"That connection..., I will make sure not to betray it...! Please tell me. What kind of agenda do you intend to bring to His Excellency?"
Choi Ki-hyun conveyed his agenda to JSD. It was to prevent the chaebols’ loophole inheritance through foundations. And JSD immediately conveyed this fact to JD, while simultaneously arranging a one-on-one meeting between JD and Choi Ki-hyun.
The location changed from JSD’s office to JD’s office. There, Choi Ki-hyun explained his agenda to JD once again.
"I understand the Chairman’s opinion well. However, that agenda is something the chaebols will greatly dislike. The risk is too high."
At JD’s polite refusal, Choi Ki-hyun wore an expression as if he understood, but opened his mouth again.
"That is why I have prepared a plan that will help with Your Excellency’s decision."
"A plan?"
"Yes. What if our YK fully supports Your Excellency in the next election?"