South Korea postpones 20% crypto tax until 2025
The South Korean government recently announced its tax reform plan and decided to postpone the taxing of cryptocurrency income to 2025.
The implementation of South Korea's crypto taxes has been delayed for another two years, according to the 2022 tax reform plan announced by a government official last week.
Accordingly, the tax on income from virtual assets as well as from the transfer or lending of virtual assets will be delayed until 2025.
According to the law, crypto investors with a year's income of 2.5 million won ($2,125) or more will be subject to a 20% tax liability.
South Korea has announced that it will impose a 20% tax on cryptocurrencies from January 1, 2022. However, then government members all agreed to amend the law and move the implementation date to 2023.
A South Korean blockchain advocate argues that the taxes may be unfair to retail crypto investors, as the threshold for taxing income from the local stock market is significantly higher.
South Korea has been ramping up crypto regulatory efforts since the Terra domino fell. Exchanges here must be registered with the government if they do not want to be touched.
In contrast to cryptocurrencies, income from NFT trading activities will be exempt from tax, because the country has not yet recognized NFT as a "virtual asset". The land of kimchi recently committed significant funding to the metaverse. Specifically, Korea has spent 177.1 million USD of the state budget betting on the metaverse and taking this technology as one of the main pillars for the upcoming development strategy.