Choi Eun-seok Bill Defers South Korea's Digital Asset Tax to 2029
Key Takeaways
- •An amendment to the Income Tax Act filed on October 27 by People Power Party lawmaker Choi Eun-seok proposes postponing South Korea's digital asset tax start date from January 1, 2027 to January 1, 2029.
- •If approved, the deferral would be the fourth delay of a levy first enacted in the 2020 tax revision, which had originally been scheduled to take effect on January 1, 2022.
- •Under the legislated framework, virtual asset gains are classified as other income and taxed at 20 percent on annual profits above 2.5 million won, assessed separately from salary or business income.
- •Successive postponements have stemmed from political disagreement over whether the tax threshold is fair relative to equity taxation, as gains from major domestic listed shares remain largely untaxed, along with demands for improved investor protections and market infrastructure.
- •The amendment must still pass the National Assembly's standing committee review and a plenary vote to become law, meaning January 1, 2027 remains the effective start date under current legislation.
A partial amendment to South Korea's Income Tax Act filed on October 27 would delay the start of digital asset taxation by two years, moving the effective date from January 1, 2027 to January 1, 2029.
The bill was introduced in the National Assembly by Choi Eun-seok of the People Power Party, which serves as the main opposition party in the South Korean legislature. Choi filed the amendment as lead author.
If enacted, the change would mark the fourth postponement of Korea's planned levy on virtual asset gains. The tax was first written into the Income Tax Act through the 2020 tax revision, with an original start date of January 1, 2022. The schedule was subsequently pushed to January 1, 2023, and then to January 1, 2025, before lawmakers from the ruling and opposition parties agreed in December 2024 to defer enforcement once again, this time to January 1, 2027.
Under the legislated framework, digital asset gains are classified as other income and taxed at a rate of 20 percent on annual profits exceeding 2.5 million won. Because the category sits outside Korea's comprehensive income taxation, virtual asset profits are assessed on their own rather than combined with salary or business income, and annual gains at or below the 2.5 million won threshold fall outside the levy.
Successive delays have reflected persistent political disagreement over the tax threshold and its fairness relative to equity taxation, with critics arguing that virtual asset investors would bear a heavier burden than stock traders, whose gains from major domestic listed shares remain largely untaxed. Legislators have also cited the need for stronger investor-protection measures and market infrastructure before enforcement begins.
The proposed two-year deferral would still need to pass the National Assembly's standing committee review and a plenary vote before becoming law. Until the amendment clears those stages, the January 1, 2027 date remains the effective start written into current law.
This content was first published on COINOTAG: https://en.coinotag.com/choi-eun-seok-bill-defers-korea-digital-asset-tax-2029
