South Korea’s ruling party looks to defer next year’s crypto taxation in amendment: Report

Noh Woong-rae of the Democratic Party of Korea has proposed legislation to delay crypto taxation.

Noh Woong-rae of the ruling Democratic Party of South Korea has proposed a “Partial Amendment to the Income Tax Act” that would delay the country’s taxation of cryptocurrency assets for until 2023.

The legislation, which Woon-rae hopes to pass in October, counters the country’s Deputy Prime Minister and main finance minister Hong Nam-ki’s intent to start taxing crypto profits in 2022 as outlined in the original version of the Income Tax Act.

Nam-ki said in April that taxation on crypto trading gains was inevitable. The Finance Ministry has previously said that cryptocurrency users will face a 20% tax on profits over 2.5 million South Korean won ($2,262).

Woong-rae and other critics argue that the “relevant taxation infrastructure is not sufficiently developed,” according to a report on Thursday by the news outlet Financial News.

“Insufficient infrastructure for taxation of virtual assets, deferral is inevitable,” said Noh who criticized the finance minister’s statement earlier this year.

Noh also said that Ministry of Finance did not have authority to start taxing cryptocurrency and that the decision was instead a legislative matter. He said that failing to mediate through proper channels would undermine citizens’ trust in their government and encourage tax evasion.

Legislation for the taxation of crypto gains has been deferred several times since it was first proposed last year.

Noh said the country’s National Assembly is expected to pass the amendment, provided the ruling and opposition parties agree, according to the report.