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South Korea backs two-year delay to crypto gains tax

South Korea's government will seek to move the crypto gains tax from 2027 to 2029, citing U.S. data-sharing timing and the need for fairer enforcement.

About Crypto Newsroom2 min read

South Korea backs two-year delay to crypto gains tax

South Korea’s government will seek a two-year delay to its cryptocurrency gains tax, citing the timing of tax information exchanges with the United States. The proposed shift would move the start date from 2027 to 2029, according to Yonhap’s report on Finance Minister Lee Hyoung-il’s announcement.

The ruling Democratic Party had formally proposed a delay a day earlier. Party leader Kim Min-seok said the party wanted a digital asset law in place first and time for businesses and investors to prepare, Yonhap reported.

Why does the government want to wait until 2029?

South Korea plans to begin exchanging information on virtual assets with Washington in 2029. The government said taxing gains before then could put the domestic market at a disadvantage and make it harder to tax overseas transactions fairly.

The proposed delay still needs legislation. The government says it will work with the National Assembly on amendments, and the change would be the fourth postponement since the tax was introduced in 2020.

What would the tax charge under current rules?

As scheduled now, annual cryptocurrency gains above 2.5 million won would face a 22 percent tax, including local income tax. That is the portion of gains above the threshold, not the investor’s full annual gains.

The government also plans to let investors carry losses forward to offset future gains, with a three-year limit under its proposal. Loss carry-forward means applying a past loss against gains in a later tax year.

What happens before a new start date is set?

A public-private working group will refine the rules, including how different transactions are taxed and how taxpayers file. The finance ministry said the group’s first meeting will take place soon, with discussions continuing through the first half of 2027.

Watch for the group’s first meeting and the government’s legislative amendments during the National Assembly’s 2027 regular session.

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