South Korea’s opposition party has reportedly agreed to delay the implementation of a new policy that will impose a tax on cryptocurrency income from January 2025.
The Democratic Party of Korea (DPK) has previously opposed the ruling People Power Party’s (PPP) proposal to defer taxes on crypto assets. This proposal should come into effect in 2021, but has already been suspended twice.
The DPK initially proposed raising the tax threshold from 2.5 million won, or $1,784, to 50 million won ($35,688) instead of delaying taxation of crypto profits, but the opposition is now changing its position.
The Korea Herald reports that DPK leader Rep. Park Chan-dae said at a press conference on Sunday that his party is no longer against the proposal to delay the implementation of the crypto tax.
“We have decided to agree to a two-year moratorium on the implementation of the cryptocurrency tax proposed by the government and the ruling party.”
In July this year, 13 representatives submitted a proposal to delay the crypto tax by three years, citing an anemic market at the time.
“However, as investment sentiment towards virtual assets deteriorates, some argue that hasty taxation of virtual assets is not desirable at this time as virtual assets are risky assets with a higher risk of loss than equities, and if income tax is also imposed , It is expected that most investors will leave the market.
Accordingly, the tax date for income from virtual assets, which will currently be taxed from January 1, 2025, will be postponed by three years to January 1, 2028 (Article 37, paragraph 5 of the bill).
But with recent developments, South Korea could start taxing crypto income as early as 2027.
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