South Korea’s ruling People’s Power Party believes that enacting cryptocurrency regulations is more important than implementing immediate taxation.
South Korea’s ruling People’s Power Party recently proposed to postpone the implementation of taxation on cryptocurrency gains for a two-year period. The postponement was proposed in view of the upcoming general election in April. The party believes that it is important to first establish a comprehensive regulatory framework before introducing any tax measures on cryptocurrency investments.
Initially, South Korea planned to impose a 20% tax on cryptocurrency investment profits exceeding 2.5 million won (about $1,875) starting in January 2023. However, this timeline was later postponed to 2025 to allow more time to formulate regulations within the cryptocurrency industry.
Now, the People’s Power Party is advocating for a further two-year delay to 2027 as part of its campaign promises. They believe that it is more important to prioritize cryptocurrency regulation than to implement an immediate tax. The party is expected to finalize its manifesto, including a proposal to postpone the election of crypto tax until the end of this month.
Calls for consistency with stock market taxation
The ruling party aims to eventually set the threshold for cryptocurrency taxation at the same level as the existing stock market tax threshold, which is 50 million won ($37,400). They believe this will create a fairer tax system compared to the current low threshold of 2.5 million won for cryptocurrency gains.
Separately, the Ministry of Economy and Finance has been considering the possibility of completely abolishing income taxes on cryptocurrencies. This is part of a broader effort to abolish taxes on financial investments. However, it is worth noting that the People’s Power Party is not proposing to abolish crypto taxes at this stage. They are simply proposing to postpone the implementation of these taxes.
Wider cryptocurrency regulations are in the works
The exact timeline and details of how South Korea will tax cryptocurrencies are still under discussion and research. Upcoming elections and changing regulatory priorities could influence the final decision on this policy.
The ruling party’s priority now is to establish a strong and reliable regulatory system before taxing cryptocurrency gains. This involves developing new rules and guidelines to address important aspects of the cryptocurrency industry, such as the responsibilities of custodian providers and the requirements for listing tokens.
Creating a regulatory framework is an important step before implementing fair and effective cryptocurrency taxation rules in South Korea. These guidelines will ensure that people can use cryptocurrencies correctly and legally. By complying with regulations, individuals can be confident that they are complying with the law when earning profits from their cryptocurrency investments, while also fulfilling their obligations to the government. Additionally, establishing these regulations can encourage the development of innovative solutions within the crypto industry. #韩国 #加密货币税收
