People Power Party lawmaker Park Soo-young on Wednesday called on South Korea's ruling Democratic Party to adopt a formal party position on deferring the digital asset income tax scheduled to take effect in January 2027.

Park made the appeal at a press conference held with young investors at the National Assembly, where she urged the Democratic Party to establish a clear line on the deferral issue.

The levy in question is South Korea's virtual asset income tax, first legislated through a 2020 revision of the Income Tax Act. Under the current schedule, annual gains from virtual asset transfers exceeding a 2.5 million won basic deduction would be taxed at 20 percent, or an effective 22 percent when combined with local income tax. For individual investors who hold or trade virtual assets, that deduction threshold and rate would define their tax exposure once the levy takes effect.

The tax has been repeatedly postponed since its original planned start. Initially slated to take effect in 2022, it was successively delayed to 2023 and then to 2025, before the National Assembly approved a further two-year postponement to January 1, 2027, in December 2024. That date now stands as the operative timeline any deferral debate would seek to move.

The debate over the tax comes as South Korea continues to build out its virtual asset regulatory framework. The Virtual Asset User Protection Act, which took effect in July 2024, addresses unfair trading practices such as market manipulation and insider trading, and imposes user-protection obligations on virtual asset service providers. Whether the ruling Democratic Party responds with a formal position on the deferral remains the next development to watch as the January 2027 effective date approaches.

This article was first published on COINOTAG: https://en.coinotag.com/park-soo-young-democratic-party-digital-asset-tax-deferral