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South Korea’s People Power Party Pushes Sept. 21 Talks With Five Exchanges on Further Crypto Tax Delay
Summary
- The People Power Party is seeking talks with South Korea’s five largest cryptocurrency exchanges on a further delay plan tied to virtual-asset taxation, which is scheduled to take effect in January next year.
- Under the current Income Tax Act, from January 2027 a 20% tax will apply to income from the transfer or lending of virtual assets above the basic deduction of 2.5 million won ($1,800), with an effective tax rate of 22% including local income tax.
- As People Power Party lawmakers have introduced bills to abolish taxation or pursue a further delay, the government and the Democratic Party are maintaining their position that taxation should begin next year.
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South Korea’s People Power Party is seeking talks with the country’s five largest cryptocurrency exchanges on possible changes to the system and a further delay to virtual-asset taxation, which is set to take effect in January next year.
Dailyian reported on Sept. 8 that the party is consulting with industry participants on plans to hold a seminar on crypto taxation at 2 p.m. on Sept. 21. Attendees under discussion include floor leader Jeong Jeom-sik, policy committee chair Lim I-ja, secretaries from relevant standing committees, executives of the five largest won-market exchanges — Dunamu, Bithumb, Coinone, Korbit and Streami — and officials from the Digital Asset eXchange Alliance, or DAXA. The schedule and attendee list have not been finalized.
Under the current Income Tax Act, a 20% tax will be imposed from January 2027 on annual income from the transfer or lending of virtual assets that exceeds the basic deduction of 2.5 million won ($1,800). Including local income tax, the effective tax rate is 22%.
Crypto taxation was originally due to begin in 2022, but the start date was postponed three times — to 2023, 2025 and 2027 — because of issues including tax infrastructure and investor-protection arrangements.
People Power Party lawmakers have also introduced bills to abolish the tax or delay it further. In March, lawmaker Song Eon-seok proposed an amendment to the Income Tax Act to remove provisions taxing income from the transfer and lending of virtual assets. Lawmaker Jeong Seong-guk submitted a bill to delay implementation by three years to 2030, while lawmaker Kim Sang-hoon proposed a separate measure to push it back by two years to 2029.
The party also held a meeting in March with executives from the five won-market exchanges and DAXA officials to discuss ways to improve the virtual-asset tax regime. By contrast, the government and the Democratic Party have maintained their position that taxation should begin next year under current law.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.