South Korea proposes delaying crypto income tax to 2029

South Korea's ruling Democratic Party proposes delaying the implementation of a 22 percent tax on cryptocurrency gains above 2.5 million won from January 2027 to 2029. Democratic Party leader Kim Min-seok stated that the country must first enact the Digital Asset Basic Act and establish international tax data-sharing infrastructure, aligning with the United States' 2029 timeline for the OECD framework. While Finance Minister Lee Hyoung-il supports the current 2027 start date, crypto industry group DAXA advocates for the deferral.

Democratic Party proposes delaying crypto tax to 2029

• ▪South Korea's ruling Democratic Party proposed delaying the implementation of a 22 percent tax on cryptocurrency gains from January 1, 2027 to 2029
• ▪Democratic Party leader Kim Min-seok announced a proposed delay of South Korea's crypto income tax from 2027 to 2029
• ▪If approved by the National Assembly, the Democratic Party's proposed delay to 2029 would mark the fourth postponement of South Korea's virtual asset tax since its initial legislation in 2020

Call for Digital Asset regulatory framework before taxation

• ▪South Korean ruling party lawmakers stated that the country should enact South Korea's Digital Asset Basic Act to establish regulatory rules before implementing taxation
• ▪Democratic Party lawmaker Oh Gi-hyoung indicated that the General Act on Digital Assets, which covers regulations for stablecoins and crypto exchanges, could be enacted in the first half of 2027

Alignment with US timeline for OECD framework

• ▪South Korea's presidential office discussed postponing the crypto income tax scheduled for January 2027 to 2029 to align with the United States' scheduled 2029 timeline for joining the OECD's Crypto-Asset Reporting Framework
• ▪While dozens of early-adopter countries began collecting crypto data in 2026 under the OECD's framework for a 2027 exchange, the United States is not scheduled to participate until 2029

Current tax schedule and opposing stance

• ▪South Korea's Finance Minister Lee Hyoung-il supported implementing the virtual asset income tax on its current schedule of January 1, 2027
• ▪Under current South Korean law, cryptocurrency gains above 2.5 million won are scheduled to face a 20 percent tax plus a 2 percent local levy starting January 1, 2027