S. Korea Weighs Fourth Delay in Crypto Tax, Pushing Start to 2029

South Korea is considering pushing the start date for its planned tax on crypto asset income back to 2029, according to recent reports. The tax, initially scheduled to take effect in January 2027, is facing delays due to inadequate tax infrastructure and concerns about tax fairness. A presidential office official stated that the biggest obstacle is the United States' refusal to share tax information, as the U.S. holds roughly half of the global crypto market.

The absence of this information would require tax authorities to individually track overseas transaction records, potentially burdening domestic exchanges. Crypto asset taxation has already been postponed three times since its introduction through a 2020 amendment to the Income Tax Act. The government's cautious approach reflects technical limitations and mounting public pressure.

National Assembly petitions calling for the abolition and postponement of crypto asset taxation have received over 50,000 signatures each, making them eligible for parliamentary consideration. A recent survey found that 73.7% of investors opposed implementing the current tax plan. Some observers suggest that concerns about winning support among younger voters have also played a role in the push for a delay.

While the crypto industry has welcomed the prospect of another postponement, critics argue that repeated delays undermine tax fairness. South Korea should implement the system while addressing its shortcomings, according to the Tax and Fiscal Reform Center of People’s Solidarity for Participatory Democracy. However, discussions on a regulatory framework for the industry remain stalled, with the Digital Asset Basic Act, or second-phase virtual asset legislation, making little progress.