SEOUL — South Korea’s debate over cryptocurrency taxation is entering a new phase after lawmakers from the ruling Democratic Party of Korea (DPK) joined growing calls to postpone the planned tax on virtual-asset income.
Under the current schedule, the cryptocurrency tax is set to begin January 1, 2027, but lawmakers and industry representatives are questioning whether the legal and administrative framework is ready.
The latest push comes from DPK lawmaker Min Byung-duk, who said taxation should be delayed until the proposed Digital Asset Basic Act is established.
His argument centers on unresolved issues including how authorities would calculate acquisition costs, track transactions through overseas exchanges and handle investment losses.
Ruling Party Support Adds Momentum to Delay Calls
Calls for postponement had previously come largely from opposition lawmakers and cryptocurrency industry groups. The involvement of lawmakers from the ruling party adds another layer to the debate.
Yonhap reported that DPK lawmaker Park Min-gyu also argued that introducing taxation before the Digital Asset Basic Act is enacted would be premature, citing uncertainty over taxation standards and transaction reporting.
Opposition lawmakers have separately introduced proposals that would postpone implementation, including measures seeking delays of two or three years.
Industry groups have also raised concerns about the ability to accurately determine acquisition costs and obtain reliable information from overseas platforms.
Government Still Backs the 2027 Rollout
Despite the growing calls for delay, Finance Minister Lee Hyoung-il has defended the existing implementation schedule.
Lee told the National Assembly that government data indicate about 85% of virtual-asset investors hold assets worth less than 5 million won. Because the planned system includes a 2.5 million won annual basic deduction, he said many investors would face little or no tax liability.
Under the current framework, profits from transferring or lending digital assets would be treated as miscellaneous income and subject to a 20% national income-tax rate, with a 2% local income tax component, after the 2.5 million won deduction.
The tax would apply to income generated from transactions beginning in 2027, with the first filing and payment period scheduled for May 2028.
Why Overseas Exchanges Are Part of the Debate
One of the major unresolved questions involves transactions conducted outside South Korea.
Lawmakers who favor a delay argue that authorities need clearer mechanisms for identifying overseas transactions and determining the appropriate tax treatment.
Industry representatives have similarly pointed to questions surrounding overseas operators, acquisition-cost calculations and different types of digital-asset transactions.
South Korea is also moving toward greater international exchange of digital-asset information through the OECD Crypto-Asset Reporting Framework (CARF), adding another layer to the country’s evolving tax infrastructure.
Investors and Industry Groups Push Back
The debate is not limited to lawmakers.
The Digital Asset eXchange Alliance (DAXA), which represents major South Korean cryptocurrency exchanges, has called for additional preparation before taxation begins.
A recent Tiger Research survey conducted with Chainalysis found that 73.7% of 2,423 Korean virtual-asset investors surveyed opposed the current taxation plan. The survey reflects the views of those respondents and does not necessarily represent all Korean investors.
A Policy That Has Already Been Delayed Multiple Times
South Korea’s cryptocurrency tax has already faced several postponements.
The tax was initially scheduled to begin in 2022, but its implementation was delayed as authorities worked through questions surrounding market conditions, investor protection and tax infrastructure.
The current January 2027 deadline therefore represents the latest stage of a policy debate that has continued for years.
At the same time, discussions over the broader Digital Asset Basic Act remain important because lawmakers are considering rules covering areas such as digital-asset businesses, investor protection and the wider cryptocurrency market.
What Happens to the 2027 Crypto Tax?
For now, the tax remains scheduled for January 1, 2027. Calls for postponement do not themselves change the law.
The central disagreement is now about timing: lawmakers seeking a delay argue that South Korea should establish its broader digital-asset regulatory framework and resolve practical tax issues first, while the finance ministry maintains that the existing tax law provides a sufficient basis for implementation.
With both the ruling party and opposition lawmakers raising concerns, South Korea’s cryptocurrency tax timetable is once again under intense scrutiny.
The next major question is whether lawmakers will change the 2027 deadline — or allow the long-delayed crypto tax to finally take effect.
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