South Korea’s Lee Reaffirms Cautious Stance on Crypto Tax, Says Decision Will Follow Consultations

South Korean Vice Premier Lee Hyoung-il, who also serves as finance minister, reaffirmed that the government will make a final decision on taxing virtual assets, or cryptocurrencies, set to take effect in January next year only after fully reviewing views from the industry and other stakeholders.

Edaily reported on Oct. 19 that Lee struck a cautious tone on whether to proceed with the tax when he met traveling reporters on Oct. 16 in Bangkok on the sidelines of a Group of 20 finance ministers’ meeting.

“We are continuing to hear opinions in order to make a comprehensive judgment,” Lee said. “It would be right to understand that we will first listen to views and then decide on the issue of crypto taxation.” His remarks underscored that gathering additional opinions remains the priority, rather than presenting a concrete conclusion on the tax timetable.

Lee also said the government will decide how to use this year’s estimated excess tax revenue of 62.3 trillion won ($45.1 billion) with market conditions in mind. Of that amount, 5 trillion won ($3.62 billion) has already been used to reduce government bond issuance, and officials will review whether to make further cuts after monitoring the bond market.

He cited a decline in market interest rates after the reduction in bond issuance, saying the move had been effective to some extent. Still, he stopped short of laying out a specific plan for the use of the remaining excess tax revenue.

On the remaining surplus, Lee said it may be possible to transfer the funds to a future response fund if a bill now under discussion in the National Assembly passes. The government plans to determine its fiscal management direction by comprehensively considering the progress of the legislation and conditions in the government bond market.