Crypto tax delayed
According to the report, the government cited the lack of a proper investor protection system alongside the current unfavorable market condition as why it decided to defer the crypto tax implementation by another two years.
The capitulation of the Terra ecosystem in May reportedly led to several losses for investors in the country. South Korean exchanges increased investors’ losses by their lack of uniform response to the crisis.
The report added that a ‘Digital Asset Framework Act’ would be implemented in 2025 when the taxation takes effect. The new framework would be tailored to meet international standards, referencing the US virtual asset-related regulatory report that would be released later this year.
Initially, the 20% crypto taxation was supposed to be implemented in January 2022. South Korean lawmakers, however, chose to defer its implementation to 2023, which has also now been shifted to 2025.
South Korea’s regulation efforts
South Korea has stepped up its crypto regulation efforts since Terra’s implosion.
Several governments are increasingly interested in taxing the crypto industry due to its record growth in previous years.
India has introduced several tough tax regimes, which include a 30% tax on crypto that has severely impacted the country’s crypto exchanges’ trading volume. Reports also revealed that the government has no intention of slashing its taxation on crypto transactions.