The South Korean National Assembly Research Service (NARS) asserted a 20% tax on cryptocurrency gains set for 2023 must maintain a 2.5 million won (US$1,942.20) threshold, contradicting new president Yoon Suk-yeol’s initiative to raise the limit to 50 million won, according to a report released on Thursday.
See related article: S.Korea finance minister nominee wants to delay crypto tax for two years
Fast facts
- Digital asset gains need to be classified as a financial investment income and allow deduction of loss carryover, according to the NARS Current Issues and Analysis report.
- The report also upheld that the crypto tax start date of Jan. 1, 2023 should no longer be delayed to 2025 as the nation’s deputy prime and finance minister nominee Choo Kyung-ho suggested in early May.
- Raising the crypto tax threshold to 50 million won to match that of stock gains was a promise to voters from Yoon during his election campaign.
- Yoon’s presidential transition committee said earlier this month that taxation will move forward after the legislation of investor protection measures, alluding to further delay.
- South Korea’s 20% tax on over 2.5 million won worth of digital asset income is set to start Jan. 1, 2023.
- The tax policy was scheduled to kick in Jan. 1, 2022, but critics insisted taxation from 2022 is premature considering the lack of investor protection measures, and was unfair as tax on financial asset gains set ground on the 50 million won mark.
See related article: Crypto tax delay is a chance for South Korea to fix loopholes, experts say