South Korea’s ruling People’s Power Party is seeking to delay a crypto gains tax until 2028. Indeed, the party had submitted a proposal for the delay last week, citing the continued shift in perspective toward the crypto market. Moreover, the party stated that a fast implementation of the tax on digital assets was “not advisable at this time.”
The party’s proposal argued the impact the tax would have on South Korean crypto traders. It discussed the risk associated with the asset as opposed to traditional investments like stocks. They stated that a tax on trading profits could lead to many exiting the market altogether.
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South Korea’s Ruling Party Seeks Crypto Tax Delay
In 2024, the crypto market has massively surged. January saw Spot Bitcoin ETFs approved in the US and then Hong Kong. The investment product led BTC to surge in value to an all-time high of $73,000 in March of this year. Yet, discussions on regulation is still ongoing in many countries.
Now, South Korea’s ruling People’s Power Party is seeking to delay a crypto tax policy till 2028. The original tax plan was set to take effect in January of next year. However, the part is seeking to push that date back for another three years.
The country had general elections take place in April 2024. Part of its campaign centered around the crypto gains tax, and this very delay. The elected party had argued for a shift in focus for the government; with the development of a crypto framework preceding any tax on gains made from crypto trading.
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According to Korean media, the tax was originally slated to take effect in 2021. However, backlash pushed the arrival date back. If the proposal goes through, the crypto legislation would officially be pushed back seven years from its first scheduled debut date.
The bill’s backlash was connected to its disproportionate tax threshold when compared to traditional stocks. South Korean investors would need to pay 20% on gains that surpass 2.5 million won, worth around $1,800. Alternatively, only stock gains above 50 million won, or $36,000, is to be taxed in the country.