South Korean lawmakers have proposed a bill to delay the implementation of crypto profits tax until 2028.
The ruling political party introduced the bill on July 12, citing current negative sentiments surrounding the crypto industry as the reason for the extension. They stated:
“As investment sentiment towards virtual assets deteriorates, some argue that hasty taxation of virtual assets is not desirable at this time, as virtual assets are risky assets with a higher risk of loss than equities, and if income tax is also imposed, Most investors are expected to leave the market.”
Initially, South Korea planned to implement its crypto profits tax on January 1, 2025. However, if the new bill is passed, the implementation date will move to January 1, 2028. The subcommittee met on July 15 to continue the review.
This move is in line with President Yoon Suk-yeol’s campaign promises. He assured voters that he would extend the tax on crypto profits during the last general election if elected. His government aims to create a clear regulatory framework before introducing the tax.
However, the Ministry of Economy and Finance has not yet made a decision on the postponement. The ministry plans to announce new tax policy changes by the end of the month.
“No decision has yet been made on whether or not to further postpone the introduction of the tax on income from virtual assets,” a ministry spokesperson said.
South Korea’s booming crypto industry
South Korea has one of the fastest growing adoptions of the emerging industry globally.
During the first quarter of this year, blockchain platform Kaiko reported that the Asian country’s national currency, Won, emerged as the leading currency for global crypto transactions, with a cumulative trading volume of $456 billion on centralized exchanges.
Moreover, the Asian country is a shining example for its proactive approach to crypto regulation. South Korea has implemented several regulations designed to improve consumer protection standards for crypto users within its jurisdiction.