South Korea readies digital-asset bill for Parliament as 2027 crypto tax review continues

South Korea is moving ahead on two parallel crypto policy tracks: officials say the long-delayed virtual-asset tax should still take effect on Jan. 1, 2027, while the government works on a broader digital-asset bill covering stablecoins and related market rules. Deputy Prime Minister Koo Yun-cheol told lawmakers at a July 29 meeting of the National Assembly’s Finance and Economy Planning Committee that the government is pushing ahead with taxing cryptocurrency from next year as scheduled. Under the current framework, annual gains from transferring or lending crypto above 2.5 million won will be taxed separately as other income at 20%, or 22% including local income tax, according to Korea’s National Tax Service. The tax was originally due to start in January 2022 and was later delayed to 2025 before a December 2024 amendment pushed implementation back to the start of 2027. The latest debate has centered on the absence of loss carryforwards. Kim Sang-hoon of the People Power Party warned that investors could shift activity to overseas centralized exchanges, decentralized platforms and peer-to-peer markets, and argued taxation should wait until the OECD’s Crypto-Asset Reporting Framework is fully operational. Koo said any move to treat crypto profits as capital gains would require a broader and more systematic review of South Korea’s capital-market tax regime. Implementation remains politically uncertain. A bill introduced in March would remove crypto income from the Income Tax Act, effectively abolishing the levy. That measure was taken up by the committee on July 29 and sent to a subcommittee. Unless lawmakers repeal or further delay the provisions, the tax takes effect Jan. 1, 2027. Separately, the Financial Services Commission has said it plans to combine pending crypto bills into a unified Digital Asset Framework Act centered on stablecoin rules, investor protection and clearer standards for digital-asset businesses, as South Korea builds out its wider regulatory regime.