Nov 4, 2026, 12:09 a.m. EST
Summary
- South Korea’s ruling Democratic Party is seeking to delay a tax on cryptocurrency gains from January 2027 to 2029, which would mark its fourth postponement.
- Lawmakers say more preparation is needed for international tax information sharing, domestic digital asset legislation and testing of tax reporting systems.
- Current law would tax annual cryptocurrency profits above 2.5 million won at 20 percent, plus a 2 percent local levy, and Finance Minister Lee Hyoung-il supports starting on schedule.
South Korea’s governing Democratic Party aims to push back the enforcement of taxes on digital asset profits by an additional two years, which would represent the fourth postponement.
Democratic members of the National Assembly’s Strategy and Finance Committee voted on November 3 to propose this postponement to the party’s leadership, local media reported. The taxation of virtual assets is currently scheduled to take effect in January 2027.
“While we agree with the basic tax principle that income should be taxed where it arises, the majority view was that, given various policy circumstances, it would be unavoidable to allow a period of preparation before implementation,” remarked Oh Gi-hyoung, who serves as the party’s committee secretary. “Most people seem to be talking about around two years.”
Two primary factors appear to motivate this renewed push for a delay. Timing is the first consideration. A global framework for sharing cryptocurrency tax data is anticipated in 2029. Although the report does not explicitly name the mechanism, it likely refers to the OECD’s Crypto-Asset Reporting Framework, which was endorsed in 2022 and prepared for worldwide deployment in 2023. Under this staged schedule, while numerous early adopter jurisdictions began gathering information in 2026 ahead of a 2027 data exchange, the United States is not slated to participate until 2029.
The second factor involves the General Act on Digital Assets, also described by policymakers as the Digital Asset Framework Act or Basic Act. Oh noted that this legislation could emerge during the first half of 2027.
Furthermore, the party intends to evaluate how tax records can be transmitted between cryptocurrency exchanges and the National Tax Service, in addition to executing tax simulations utilizing actual trade data. This proposed tax delay will be incorporated into upcoming discussions regarding amendments to the Income Tax Act during a future meeting of the Tax subcommittee.
Under existing regulations, digital asset gains exceeding 2.5 million won are subject to a 20% tax starting January 1, 2027, alongside a 2% local surcharge. The Korea Times reported that this tax was originally slated for 2022 and has already been deferred on three occasions. Finance Minister Lee Hyoung-il has advocated for implementing the policy on time, whereas the exchange association DAXA has petitioned for a deferral.
The General Act on Digital Assets, frequently termed the Digital Asset Basic Act, aims to establish guidelines for stablecoins and trading platforms. According to compliance provider Sumsub, drafting was still underway as of late July, with ten active bills pending in the Assembly alongside debates regarding whether financial institutions ought to regulate issuers of won-pegged stablecoins.
Elsewhere in the Asian region, Japan is moving in a different direction. Domestic news outlets indicate that authorities are drafting a standardized 20% tax on digital currency profits—lowered from maximum rates reaching 55%—alongside reclassifying tokens under securities legislation.
Meanwhile, Hong Kong and Singapore have already established operational licensing frameworks for digital asset platforms.
Originally published at https://www.coindesk.com/policy/2026/11/04/south-korea-s-ruling-party-wants-to-put-off-its-crypto-tax-again.
