Choo Kyung-ho, the yet-to-be-confirmed nominee for deputy prime minister and finance minister, said Monday a planned 20% tax on capital gains from digital asset investments and stock market investment should be pushed back until January 2025.
See related article: South Korea’s 20% tax on virtual asset gains is postponed
- During a National Assembly confirmation hearing on Monday, Choo said it was too early for the crypto industry to accommodate a 20% levy on trading gains.
- Choo said it would be better to postpone the tax until the crypto market had matured and new legislation was readied to ensure transparency and investor protection in digital asset transactions.
- South Korea announced in December 2020 a 20% levy on crypto gains above 2.5 million KRW (US$1,974.10).
- The ruling Democratic Party and the opposing right-of-center People Power Party agreed in November 2021 to delay the crypto tax from Jan. 1, 2022 to Jan. 1, 2023.
- The announcement sparked a backlash from investors who claimed the new tax would negatively impact the growing crypto industry, and that the threshold was too low considering a tax planned for the stock market would kick in on capital gains above 50 million KRW (US$39,475.76). The levy on stock market gains is slated to begin Jan. 1, 2023.
- South Korea’s president-elect Yoon Suk-yeol had promised during his campaign that crypto investors would be taxed on the same grounds as investors in other financial assets.
See related article: Crypto tax delay is a chance for South Korea to fix loopholes, experts say