The presidential office is considering a fourth delay to South Korea’s planned levy on cryptocurrency income, potentially pushing its start to 2029. The tax remains scheduled to begin January 1, 2027, unless lawmakers change the law.
The office said in an October 25 press notice that it was weighing another postponement. It has not decided whether to seek one.
An official said the discussion had shifted toward delaying implementation. The government is weighing the proposal against a gap in overseas transaction data, unresolved tax systems and pressure from lawmakers and investors.
The existing date remains in force. A change requires parliamentary approval.
The reporting timetable leaves a gap in U.S. transaction data
The central obstacle cited by officials is access to transaction records from the United States, which accounts for roughly half of the global cryptocurrency market. Without those records, tax authorities could have to track overseas activity one transaction at a time, a presidential office official said.
That could leave users of domestic exchanges facing tax collection before comparable information on U.S. platforms becomes available. The official described the missing records as “the biggest bottleneck” for taxation.
The OECD’s Crypto-Asset Reporting Framework, or CARF, sets a schedule for automatic exchanges between tax authorities:
| When exchanges begin | Jurisdictions included |
|---|---|
| 2027 | South Korea and 45 other countries |
| 2028 | Canada, Switzerland, Singapore, Hong Kong and 25 other countries |
| Two years after the first exchange | The United States |
The timetable is the basis of a ruling-party proposal that would start the levy two years after the first year of cross-border data exchange. If exchanges begin on schedule, that formula points to the proposed year in the headline.
The levy would apply to net gains above a 2.5 million won deduction
A 2020 amendment to the Income Tax Act created the levy. It covers annual income from transferring or lending virtual assets, after acquisition costs and necessary expenses are deducted.
The rate totals 22%: 20% national income tax and 2% local income tax. The annual basic deduction is 2.5 million won, roughly $1,888–$1,890.
The calculations vary with gains. An investor with 5 million won in qualifying annual gains would owe 550,000 won after the deduction. At 10 million won in eligible annual net gains, the bill would be 1.65 million won, an effective rate of 16.5%.
The original start date was January 2022. Legislators delayed the levy to 2023, then 2025, and later January 2027, citing insufficient tax infrastructure and investor protections. Another postponement would be the fourth.
Bills in both parties would change the timetable or remove the levy
Democratic Party lawmaker Park Min-gyu and 13 colleagues introduced a bill on October 16 to tie the start date to cross-border reporting. Twelve Democratic Party lawmakers and one Rebuilding Korea Party lawmaker joined as co-sponsors. Park was the first ruling-party member to propose a delay.
The opposition has advanced a broader set of options. People Power Party lawmaker Song Eon-seok filed a bill to remove the crypto tax provisions altogether; fellow party lawmakers Kim Sang-hoon and Jung Sung-kuk proposed postponements. Other PPP bills suggest a start date of 2029 or 2030.
PPP Rep. Park Soo-young held an October 21 press conference at the National Assembly with cryptocurrency investors and called for a two-year delay. “We must not kick away the ladder for young people to build assets,” he said. Park also said he would try to arrange talks between the parties’ floor secretaries because the Democratic Party had not adopted a delay as party policy.
Democratic Party leader Kim Min-seok said on the party’s YouTube channel on October 22 that it would hold intensive discussions about proceeding as planned or revising the system. He said the party would reach a conclusion before the end of the year.
Officials and exchanges cite readiness, while critics oppose another delay
Finance Minister Lee Hyeong-il told a parliamentary audit on October 22 that the government would decide “after carefully considering and gathering all opinions from the industry and the National Assembly.” Financial Services Commission chairman Lee Eog-weon said the levy should “take various circumstances into full consideration.”
First Vice Minister of Economy and Finance Kwon Dae-young had stressed the principle of taxation while also pointing to readiness: “For the taxation principle to take proper root in the market, the tax infrastructure and market discipline framework must be in place together.” A senior government official said on October 21 that the tax affected as many as 11 million investors and that the government still needed to see how discussions went in the tax subcommittee.
Then-National Tax Service Commissioner Lim Kwang-hyun told lawmakers at an October 13 audit that detailed standards would be announced the following month. He has since been named presidential chief of staff.
Financial authorities counted 11,175,000 domestic accounts able to trade cryptocurrencies at the end of June 2026. The Financial Supervisory Service put average daily trading value at about 3.1 trillion won in the first half of 2026, down 51.5% from the same period a year earlier.
Two National Assembly petitions, one seeking repeal and the other a two-year delay, each passed 50,000 signatures, the threshold for parliamentary consideration. A recent survey found 73.7% of investors opposed the existing plan. People in their 30s and 40s make up more than half of domestic cryptocurrency users.
A Gallup Korea survey conducted October 20–22 found presidential approval had fallen among voters in their 20s and 30s. The survey did not establish that the tax debate caused the decline.
Officials from the country’s five largest won-denominated exchanges warned that imposing the levy without adequate preparation could push investors toward overseas platforms or decentralized finance services. One exchange official said a delay would give the industry more time to build consistent transaction-calculation systems.
The Korea Digital Asset Business Association backed the proposed start year on October 22 and urged lawmakers to pass a digital-asset law with investor protections comparable to those in stock markets before taxation begins. The Tax and Fiscal Reform Center of People’s Solidarity for Participatory Democracy opposed further delays, saying repeated postponements driven by public opinion and elections weaken tax-policy predictability. It argued the system should begin while its shortcomings are addressed, noting that the United States, United Kingdom and Japan already tax crypto-related income.
Cost-basis rules and a missing digital-asset law remain unresolved
Domestic exchanges do not have standardized methods for establishing original purchase costs when assets arrive from overseas platforms or private wallets. Officials and investors have also criticized unclear treatment of airdrops and staking.
The Virtual Asset User Protection Act took effect in July 2024. The separate Digital Asset Basic Act, which would cover stablecoin issuance and distribution and rules for virtual asset service providers, has not passed, and discussions have made little progress.
Lawmakers have questioned whether the country should tax a market before the law defining it is in place. Industry and government voices have also raised the absence of a loss carryforward deduction and a weakening domestic market as sources of likely investor backlash.
A draft tax notice is due before lawmakers consider revisions
The National Tax Service plans to publish a draft notice on taxable income from virtual assets by the end of October. Inter-agency consultations were expected to start as early as October 26, after parliamentary audits conclude.
The government’s position is expected to take shape through those consultations. Lawmakers are expected to work through tax revisions starting in November, with discussions on the final change anticipated in late November and early December.
Parliament must amend the law before the scheduled start can move. Until then, the existing date stands.
