South Korea Weighs Fourth Crypto Tax Delay With 2029 Start

South Korea's presidential office is reviewing a fourth postponement of the country's 22% tax on crypto gains, with a 2029 start date gaining traction among lawmakers and industry groups, according to Newsis reporting.

The levy is currently scheduled to take effect January 1, 2027. The presidential office said it is in talks with government agencies about a delay, citing gaps in the regulatory framework and the difficulty of treating domestic and overseas trades the same way.

The tax dates to a 2020 amendment to the Income Tax Act. It applies a 20% national rate plus a 2% local rate to annual income from the transfer or lending of virtual assets above a 2.5 million won ($1,888) deduction. The start date was originally set for 2022, then pushed to 2023, 2025 and 2027 as officials conceded that tax systems and investor protections were not ready.

Why 2029 is the new target

The argument for 2029 rests on the OECD's Crypto-Asset Reporting Framework, the standard under which tax authorities swap crypto transaction records with one another. South Korea is among the first group of jurisdictions set to begin exchanges in 2027. The United States does not join until 2029.

A presidential office official told Newsis that the absence of U.S. trading data is the biggest bottleneck. Without it, the National Tax Service would have to chase overseas transactions one by one, and Korean traders on domestic exchanges would carry a heavier burden than those using foreign platforms or self-custody wallets.

On October 16, Democratic Party lawmaker Park Min-gyu and 13 colleagues filed a bill that would push the tax to January 1 of the second year after the first international data exchange — which works out to 2029. People Power Party lawmaker Song Eon-seok filed a separate bill that would strike the crypto tax provisions from the law entirely.

The Korea Digital Asset Business Association backed the 2029 date Thursday and asked the government to pass a digital asset law with stock-market-grade investor protections before any tax takes effect.

How the political pressure built

The pressure has come from several directions at once. Last week, two public petitions — one to repeal the tax and one to defer it two years — each cleared the 50,000 signatures that force a legislative review. Democratic Party leader Kim Min-seok called for a "thorough final review," a shift for a party that had previously held the line on the 2027 start.

Finance Minister Lee Hyeong-il told a parliamentary audit Thursday that the government would decide "after carefully considering and gathering all opinions from the industry and the National Assembly." Financial Services Commission chairman Lee Eog-weon said the same day that the tax should "take various circumstances into full consideration."

The regulatory backdrop complicates the timeline. The Virtual Asset User Protection Act took effect in July 2024, but the Digital Asset Basic Act — the licensing framework flagged alongside spot bitcoin ETF approval — has not passed. Lawmakers have questioned taxing a market before the law defining it exists.

What happens next

The National Tax Service has not slowed down. It plans to publish a draft notice on taxable crypto income by the end of October. The government expects to settle its position through inter-agency talks after audits wrap, with a decision arriving through National Assembly tax revisions between late November and early December.

That six-week window is the real deadline. If the Assembly does not amend the law before year-end, the 2027 start stands on the books, and the NTS draft notice will define how it is enforced — against a market that still has no licensing statute behind it.