South Korea’s ruling party has promised a 2-year delay to the crypto tax as the election is approaching
The People's Power Party – South Korea's ruling party – has launched a push to delay the crypto profits tax for another two years as part of a campaign promise for April's general election.
Local media Herald Business Daily reported that the political party shared its position that it is imperative to create a comprehensive framework for crypto before going into taxation. The party believes that crypto payments can only be made when this basic framework is established.
The party representative also emphasized that the tax base has not been established yet. Unlike stock exchanges, the authority clarified that no entities are obligated to regulate crypto transactions. The party believes that two years are necessary to establish such a system. The ruling party official pointed out that taxes should protect the country's property and citizens' lives, and said that so far some government affairs have neglected the crypto market.
The plan to employ crypto trading profits was announced in January 2021. Under the tax rules, crypto investors who make more than 2.5 million in profit in a year (around $1,900) are required to pay a 20% tax. The limit is much lower than for stocks, with gains over 50 million won (about $37,400) subject to tax.
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The implementation of the tax has faced several delays over the years. Initially, the tax was planned to be implemented in 2022, but the legislators reached an agreement to delay the implementation of the tax until 2023, citing deficiencies in the data collection processes carried out by the National Tax Service.
In the year In July 2022, government officials announced that they had postponed the implementation of the 20% crypto profit tax for two years. This time, the legislators mentioned the market situation in the crypto space. At the time, Bitcoin (BTC) was trading at around $20,000 and has since fallen to $16,000. The government also said that time is needed to develop investor protection measures.
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