TL;DR
- South Korea’s ruling Democratic Party is seeking a two-year delay to its crypto gains tax, currently scheduled to begin in January 2027, which would become the fourth postponement.
- The current framework applies a 20% tax plus a 2% local levy to annual crypto profits above 2.5 million won.
- Lawmakers want more preparation for international tax-information sharing, the Digital Asset Basic Act, tax-reporting systems and system stability testing before full implementation.
South Korea’s ruling Democratic Party is seeking another delay to its cryptocurrency gains tax, scheduled to take effect in January 2027. Finance committee lawmakers agreed on November 3 to recommend a two-year postponement to party leadership, according to the official source. If approved, it would become the fourth delay since the regime was first scheduled for 2022. The proposal would push back taxation of cryptocurrencies while lawmakers prepare supporting systems and digital asset legislation.
South Korea Weighs Another Crypto Tax Delay
The current framework would impose a 20% tax on annual crypto profits above 2.5 million won, plus a 2% local levy, beginning January 1, 2027. The measure has already been postponed three times. Finance Minister Lee Hyoung-il has supported beginning taxation on schedule, while the Digital Asset Exchange Alliance has requested another delay. The latest proposal remains subject to further legislative action rather than changing the crypto tax schedule immediately.
Lawmakers cited international tax-information exchange preparations and the pending General Act on Digital Assets to justify more time. Oh Gi-hyoung, the ruling party’s secretary on the National Assembly’s Strategy and Finance Committee, said most participants were discussing a delay of around two years. He also said the broader digital asset law could be established as early as the first half of 2027, potentially changing classifications for operators and transaction structures as South Korea advances its digital asset framework.
The preparation plan includes reviewing how tax information can be shared between the National Tax Service and cryptocurrency exchanges, conducting tax simulations with actual transaction data and testing system stability. The Democratic Party intends to incorporate the postponement proposal when lawmakers discuss amendments to the Income Tax Act in a future tax subcommittee meeting. The two-year timeline would align the debate with an international virtual-asset tax-information exchange system expected in 2029, adding context to earlier calls for a delay.
The proposal adds another stage to South Korea’s debate over when cryptocurrency gains should be taxed. Lawmakers agreed with the principle that income should be taxed where it arises, but the committee majority favored additional preparation before implementation. The requested postponement does not cancel the tax or establish a new effective date on its own. A legislative change would still be needed before the January 2027 schedule can be replaced in law, despite earlier proposals for a longer postponement.
