South Korean lawmakers are expected to review their cryptocurrency tax plan after a long-awaited petition to repeal the framework exceeded the number of signatures required for it to be debated in the National Assembly.
Over 50,000 Koreans sign crypto tax petition
As South Korean authorities prepare to implement the upcoming income tax law, a petition has been filed to block the tax system on cryptocurrencies acquired With massive support from South Korean investors and some policymakers.
The “Petition to Repeal Taxes on Virtual Assets” passed the signature requirement on May 21, just eight days after it was registered. Notably, the petition must collect 50,000 signatures within 30 days of public release to be automatically referred to the National Assembly for review.
For context, crypto assets will be subject to an income tax rate of up to 22%, starting January 1, 2027, on profits exceeding 2.5 million won annually. The South Korean government proposed implementing the income tax law by January 2022, but the rule change has been postponed three times.
At the time of writing, government tax plans on cryptocurrencies have been requested to be scrapped Gather together More than 53,000 signatures on the National Assembly’s Public Petitions Board. Therefore, the petition will be reviewed by the Finance, Economy and Planning Committee, which will decide whether to refer it to the General Committee.
The petition said that with the recent abolition of income tax on financial investment to enhance the capital market developmentIt is difficult to justify imposing separate taxes on crypto assets.
The request stressed that “there are major concerns that current policies focus excessively on regulation and securing tax revenues, while neglecting consideration of industrial competitiveness and securing global market leadership,” adding that “if taxes are imposed only for short-term revenues, this may lead to greater losses in the long term, such as industrial contraction and the outflow of capital and talent.”
It also criticized the push to introduce taxes before measures such as short-selling regulations, listing audits, investor protection funds and unfair trading monitoring systems were adequately put in place.
Therefore, the petitioner argues that the system of taxation of crypto assets requires “a fundamental review rather than a mere supplement or postponement,” stating that the current system will only increase burdens on the public and shrink the industry. “It is time for a comprehensive re-discussion, including the possibility of repeal, rather than default taxation of assets,” the letter said.
However, previous Reports She notes that the chances of a crypto tax plan being scrapped or delayed are low, given that parliamentary petitions rarely lead to legislative change, and officials appear intent on implementing in 2027.
NTS is preparing to implement the Income Tax Law
Last month, the People Power Party won. foot A bill to amend the income tax law to eliminate taxes on cryptocurrency assets. In the amendment, Pakistan People’s Party leader Song Eun-seok proposed removing all provisions governing taxation of digital assets in the current version of the income tax law.
As reported by Bitcoinist, the bill says imposing a separate income tax on crypto assets raises concerns about the fairness and consistency of the tax system. Additionally, it cites guidance from US financial regulators, which classify most digital assets as commodities rather than securities.
Despite these efforts, the National Tax Service (NTS) recently announced that it had begun Preparations To implement the framework for taxation of crypto assets next year. In late April, Park Jeong-yeol, director of the Individual Tax Office at the National Tax Service, explained the agency’s plan to secure data from exchanges and create a tax system to ensure rapid implementation of the comprehensive income tax.
NTS is also accelerating the development of its tax infrastructure, including an artificial intelligence-based system for tracking investment gains in cryptocurrencies, which the agency expects to launch at full scale by the end of the year.
The total crypto market capitalization is at $2.54 trillion in the one-week chart. Source: TOTAL on TradingView
Featured image from Unsplash.com, chart from TradingView.com
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