South Korean investors may have to wait a bit longer before they start paying taxes on their cryptocurrency holdings. The new crypto tax regime was scheduled to take effect in January next year, but according to local reports, the ruling Democratic Party of Korea (DPK) has reached a consensus to go against the government and push for yet another delay.
The South Korean government has been pushing to start levying a 20% tax on crypto gains.
The South Korean government has been pushing to start levying a 20% tax on crypto gains worth 2.5 million won ($2,125) starting on January 1, 2022. The crypto tax law was to take effect this week, on October 1 initially. However, it was postponed for three more months to next year due to an insufficiency in taxation infrastructure for the still-nascent digital currency industry. As reported earlier, the ruling DPK party has been pushing for yet another delay, but the Finance Minister has played down the push.
The tax implementation could be delayed for one more year.
According to the Korea Times, the party has reached a consensus to push for legislative changes to delay the implementation for at least one more year. For the DPK party, the latest push is mostly politically motivated. The party is out to lure the younger generation, mostly in their 20s and 30s, who have invested in cryptocurrencies. South Korea is set to hold its presidential election in March next year, making it even more pertinent for the party to lure investors. The party, which has been the most popular, has been losing its support in light of some disastrous policy moves by the outgoing President Moon Jae-in, especially in the real estate industry.