South Korea delays crypto tax implementation to 2027

South Korea’s Democratic Party (KDP) has agreed to a two-year postponement of the country’s crypto capital gains tax, extending the implementation to 2027. 

This decision comes after the ruling People’s Power Party (PPP) initially proposed a three-year delay. 

Park Chan-dae, the KDP’s floor leader, confirmed the agreement during a December 1 press conference. 

The law was originally set to take effect in January 2025 but has faced consistent delays due to pushback from both political parties and stakeholders. 

The Democratic Party had previously opposed deferring the tax, calling the ruling party’s plan a "political trick." 

In a November 20 statement, the KDP proposed increasing the tax threshold from $1,800 to $36,000 to target large investors rather than delaying implementation. 

The initial plan to tax crypto gains was introduced in 2021 but has since been postponed multiple times. 

Stakeholders have raised concerns about the potential impact on the market and investor interests. 

The ruling PPP argued that imposing the tax too quickly could drive investors out of the market, leading to the proposed grace period. 

South Korean investors will face a 20% tax on crypto trading profits once the law is enforced. 

However, the repeated delays highlight the ongoing debate about balancing regulation and market stability. 

The KDP’s decision marks a shift from its earlier stance, aligning with the government’s approach to prioritize a gradual introduction of crypto taxation policies.