South Korea's ruling party plans to delay cryptocurrency tax, as part of its campaign promise for the April parliamentary elections.

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South Korea's Ruling Party Plans to Delay Crypto Tax, Becomes Election Promise?

According to media under the South Korean conglomerate Herald Media Group, Heraldcorp reported that South Korea's ruling party, the People Power Party, is attempting to delay the capital gains tax on cryptocurrency earnings for another two years and may use this as one of its election promises for the April parliamentary elections.

The virtual asset income tax system was introduced in December 2020 and was initially expected to be implemented starting in 2022. However, due to the need to establish supporting measures, it was delayed again until January 2025, and now it may be postponed until 2027.

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Significant Discrepancy in Tax Rates Between Stocks and Cryptocurrencies, Criticized for Tax Discrimination

The report points out that adjusting the tax base is also under consideration. According to the current income tax law, as of January 1, 2025, income obtained from transferring or renting virtual assets will be classified as other income subject to taxation. When the income exceeds 2.5 million Korean won, the tax rate is 22%, including local taxes.

However, the tax-free amount for stocks is as high as 50 million Korean won, while for virtual assets, it is only 2.5 million Korean won, leading to criticism of "tax discrimination."

An official from the People Power Party stated that the party's leadership's position is to finalize the core promises for the election before February and will announce this as soon as possible.

Previously, South Korean President Yoon Suk-yeol promised to increase the tax-exempt amount for crypto investments, but in the end, the original proposal of 2.5 million Korean won was maintained.

South Korean President Yoon Suk-yeol's Election Promise Changes, Ministry of Finance Maintains Original Threshold for Cryptocurrency Taxes