
South Korean lawmakers have agreed to postpone the implementation of a capital gains tax on cryptocurrencies until January 2027, in a move aimed at supporting the growth of the nascent market amidst the challenges it faces. The decision comes after extensive consultations with various stakeholders, including industry experts and investors.
The leader of the Democratic Party, Park Chan-dae, announced the decision, saying, “We recognize the importance of developing the cryptocurrency sector in South Korea, but we also believe that it is necessary to protect small investors. Therefore, we have decided to postpone the implementation of the tax for two years, which will give the market enough time to stabilize and grow.”
While the government proposed a two-year postponement and the ruling People Power Party proposed a three-year postponement of the implementation of the capital gains tax on cryptocurrencies, the Democratic Party opposed both proposals and instead called for increasing tax deductions on such gains.
The Democratic Party’s initial proposal was to raise the tax exemption threshold for cryptocurrency gains to 50 million won, a significant increase from the current threshold of 2.5 million won. The party believed that this amendment could meet the demands of small investors without the need to postpone the implementation of the law.