According to reports, the South Korean government delayed the implementation of the 20% tax on crypto gains by two more years. Although the controversial 20% tax on crypto-gains was due to go into effect January 1, 2023 it has been postponed to 2025.
On Thursday, the government announced its new tax reform plans. They deferred the crypto tax policy until 2025 due to stagnant market conditions, as well as the time needed for investor protection measures. The initial plan to impose an additional 20% taxes on crypto gains exceeding 2.5million won ($1,900) within a year remains unchanged.
Since its January 2021 announcement, the controversial 20% crypto tax was delayed for the second consecutive time. The tax was first supposed to be introduced by January 2022, but lawmakers in the country deferred it to 2023 so it has been delayed by two more years.
Related: Despite strict regulations, the South Korean crypto market will grow to $45.9B by 2021
Kim Young-jin (chairman of the Tax Subcommittee), one of the legislators that has opposed the crypto tax strategy, has called for the creation of solid crypto regulation. Korea has a pro-crypto president who is now in office. Korea wants to regulate the crypto market and then put into place tax rules.
Crypto taxation has been on the top of the government’s agenda as the crypto market grew to new highs over the past few years. Just like South Korea’s proposal of a 20% tax, Thailand proposed a 15% crypto gains tax, however, it received heavy backlash from the retail trades and the government eventually had to scrap the tax policy.
India introduced a 30% tax to crypto beginning April 1. However, this tax has caused havoc for crypto exchanges in India. Within weeks, trading volumes plummeted by more than 90%.
According to a leaked report, the president was working on the Digital Asset Basic Act (DABA), according to May’s leak. The regulations will concentrate on nonfungible tokens as well as initial coin offerings. They also aim to expand infrastructure and support central bank research in digital currency.