TLDR
- South Korea is considering postponing its cryptocurrency gains tax until January 2029.
- The planned 22% tax applies to annual crypto gains exceeding 2.5 million won.
- Delayed access to US trading records remains a major concern for tax authorities.
- Democratic Party lawmaker Park Min-gyu has proposed another two-year postponement.
- Lawmakers could settle the issue during tax law discussions in November or December 2026.
South Korea may delay its planned tax on cryptocurrency profits until 2029, marking a fourth postponement if approved. The presidential office is discussing the proposal with government agencies, according to local reports. The levy is currently due to begin on January 1, 2027.
Why South Korea Faces Another Delay
The tax would apply a 22% rate to annual crypto gains above 2.5 million won. This combines 20% income tax and 2% local tax. It covers profits from selling, transferring or lending digital assets. Investors would pay tax only on gains exceeding the annual basic deduction.
Lawmakers approved the plan in 2020 for a January 2022 launch. Officials then moved the start to 2023, 2025 and 2027. Each change followed concerns about recordkeeping, overseas trading data and safeguards for investors.
Overseas Trading Records Raise Questions
South Korea plans to exchange crypto records under the OECD’s Crypto-Asset Reporting Framework, known as CARF, starting in 2027. The tax debate comes as lawmakers examine new rules for crypto businesses, including exchange licensing and stablecoin oversight.
The United States plans to join CARF in 2029. A presidential office official reportedly called the lack of US exchange data a major obstacle. Without those records, authorities might need to check foreign trades individually while domestic exchange platforms face closer scrutiny.
Lawmakers Seek a 2029 Start
Democratic Party lawmaker Park Min-gyu introduced a bill on October 16 with 13 fellow lawmakers. The proposal would begin crypto taxation two years after countries first exchange transaction records under CARF. On the current schedule, that means January 2029.
The opposition People Power Party has backed further delays, citing gaps in tax systems. French lawmakers recently backed a proposed tax on certain crypto-to-stablecoin swaps. Their measure differs from South Korea’s planned annual gains tax.
Final Decision Still Pending
South Korea’s tax authority has continued implementation work despite the dispute. Exchange representatives have asked for clearer rules on recording overseas trades and calculating costs. The wider Digital Asset Basic Act has yet to pass parliament.
The policy debate is taking place as European officials consider revisions to crypto regulations. Those discussions concern market conduct and digital asset services, rather than South Korea’s proposed income tax. Government and ruling party officials plan further consultations after parliamentary audits. Lawmakers are expected to examine income tax changes in late November or early December.
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