South Korean Government Mulls 3-Year Delay on Crypto Taxes
“The daily cryptocurrency trading volume on domestic exchanges, which was in the 20 trillion won range in March, has recently plummeted to the 2 trillion won range. If the cryptocurrency income tax is imposed early next year, most investors will leave, further reducing trading.”
A South Korean news outlet recently reported that the ruling government is considering a three-year postponement of the crypto tax implementation. As a result, the taxation on crypto capital gains, initially set to start in January 2025, would be delayed until January 2028.
Crypto Tax Relief to South Korean Investors Likely
Crypto taxation has been a matter of strong discussion in South Korea, originally started in 2021, after passing the related tax law in the National Assembly during the Moon Jae-in administration. Later, they further postponed the decision to 2023 considering the presidential election in the following year, and further to January 2025 under the Yoon Seok-yeol administration.
Some have criticized that the public opinion of the taxpayers largely influences the crypto tax policy in South Korea. In May 2024, the Financial Services Commission (FSC) presented data showing that the total number of crypto investors in South Korea has shot up by 6.45 million.
With the falling Bitcoin price and strong correction in the broader crypto market, there’s growing dissatisfaction on issues related to crypto taxes currently in South Korea. One of the market insiders told Hankyung publication:
“The daily cryptocurrency trading volume on domestic exchanges, which was in the 20 trillion won range in March, has recently plummeted to the 2 trillion won range. If the cryptocurrency income tax is imposed early next year, most investors will leave, further reducing trading.”
