South Korea Proposes Fourth Delay of Cryptocurrency Tax to 2029
South Korea’s government has endorsed a proposal to delay the cryptocurrency gains tax by an additional two years, pushing the start date to 2029. This would mark the fourth time the tax implementation has been postponed.
Finance Minister Lee Hyun-il announced the plan on Thursday, explaining that the government will consult with lawmakers to consider moving the tax effective date from January 2027 to a later time.
The tax would apply a 22% rate—comprising a 20% income tax plus a 2% local tax—on annual crypto profits exceeding 2.5 million won (approximately $1,860).
The authorities justified the 2029 timeline by pointing to the expected commencement of information sharing with the United States under the Crypto-Asset Reporting Framework (CARF). They emphasized that enforcing the tax before these exchanges begin could disadvantage South Korea’s domestic market compared to international platforms, and they also aim to account for upcoming changes in digital asset legislation.
Officials additionally revealed plans to introduce a provision allowing investors to carry forward crypto losses for up to three years. This would enable offsetting losses against future profits within that period. The government intends to propose related tax system amendments during the 2027 parliamentary session and to release detailed tax guidelines in early 2028.
Initially, the crypto gains tax was set to start in January 2022 but was postponed successively to 2023, then 2025, and later to 2027.
This latest proposal represents a shift from the government’s earlier stance. In May, a Ministry of Finance spokesperson had affirmed the tax would be implemented in 2027.
Recent discussions between South Korean financial officials and major cryptocurrency exchanges reflect increasing industry requests to delay the tax. Industry leaders have pointed to unresolved tax regulations for various transaction types and insufficient preparation time for necessary infrastructure.
South Korea’s delay in implementing the cryptocurrency gains tax highlights the government’s caution to align domestic regulation with international standards and market readiness, aiming to ensure competitiveness and effective tax administration.
Why it matters
Delaying the crypto tax until 2029 allows South Korea to synchronize with upcoming international reporting standards and to better prepare its tax framework, potentially protecting its domestic crypto market’s competitiveness.
Prepared from the source material with AI-assisted editing and checked against the supplied facts.
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