Ruling Party of South Korea Pushes for Delay in Cryptocurrency Tax in Election Commitment
Last updated:
February 19, 2024 00:47 EST
| 2 min read
Source: CJ Nattanai/Adobe
South Korea’s ruling People Power Party is advocating for a two-year postponement of the taxation on gains from cryptocurrency investments.
The move is seen as a potential campaign promise for the upcoming general election scheduled for April.
The party aims to prioritize establishing a comprehensive regulatory framework for cryptocurrencies before implementing taxation measures.
South Korea’s Ruling Party to Propose New Regulations
According to local media outlet Herald Business Daily, the right-wing party intends to propose a new set of regulations addressing the crypto industry in the upcoming term.
By focusing on regulatory measures first, the party aims to delay the implementation of the crypto gains tax, which is currently slated to take effect in January 2025.
This proposed delay would push the tax plan to start in 2027.
As part of its election campaign strategy, the ruling party is considering introducing a bill that encompasses essential elements for potential crypto regulations.
These regulations may include requirements for crypto custody providers and guidelines for token listing.
If implemented, these regulations would supplement South Korea’s initial set of crypto regulations set to become effective in July.
The People Power Party plans to finalize its core election promises by the end of the month.
In a recent development, a representative from South Korea’s Ministry of Economy and Finance suggested that the country’s legislative body should discuss the possibility of abolishing income tax on crypto assets.
This suggestion aligns with the current administration’s initiative to scrap the planned tax on financial investments, including stocks and funds.
However, the People Power Party does not ostensibly explore a complete abolition of the proposed cryptocurrency taxation, as reported by Herald.
Alongside advocating for a tax delay, the party also aims to harmonize the cryptocurrency tax threshold with that of stocks.
Currently, the tax plan imposes a 22% tax rate on crypto gains exceeding 2.5 million Korean won (approximately $1,875).
In contrast, gains from stocks are only taxed when they surpass 50 million won.
South Korea to Mande Officials Disclose Crypto Holdings
In December last year, South Korea announced that high-ranking public officials will be required to disclose their cryptocurrency holdings starting next year.
At the time, the country’s personnel ministry said this proactive approach was intended to address potential conflicts of interest and promote integrity within the public sector.
By mandating disclosure of cryptocurrency holdings, the government aims to ensure that public officials maintain the highest ethical standards and avoid any potential conflicts that may arise from their involvement in the crypto market.
The requirement would apply to high-ranking officials across various government agencies and departments.
Meanwhile, Lee Bok-hyun, South Korea’s head of the Financial Supervisory Service, aims to visit the United States later and discuss the crypto industry with U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler.
Specifically, the official is set to speak with Gensler regarding spot Bitcoin ETFs.
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