Cho Seung-rae, who chairs the National Assembly's Policy Committee, said on Friday that South Korea should hold back its digital asset tax decree until lawmakers reach a decision on how the levy will work. He made the remarks during a meeting with digital asset business operators at the National Assembly, according to COINOTAG.

The decree in question would set out the operational details for the country's digital asset tax, which is currently scheduled to take effect in 2027. Under South Korea's existing tax legislation, capital gains from virtual asset transactions are subject to a 20% tax on annual gains exceeding 2.5 million won. Since the decree is the instrument that spells out how that rate is assessed and collected, its finalization is the step that determines how the legislated levy actually functions in practice — the issue at the heart of Cho's remark.

Background: A Tax Postponed Three Times

The levy was first legislated in 2020 with an original start date of 2021. It was subsequently delayed to 2023, then to 2025, and finally to January 2027 under a cross-party agreement reached in the National Assembly in December 2024. That record of repeated postponements frames Cho's latest intervention: the current date was itself the product of a legislative compromise, and the decree-stage mechanics remain undecided.

South Korea's baseline regulatory framework for the sector, the Virtual Asset User Protection Act, took effect in July 2024, introducing measures such as the segregation of user deposits and designated responsibilities for virtual asset service providers. Taxation, however, is governed by separate income tax provisions, and the enforcement decree containing the specifics of how the levy will be assessed and collected has yet to be finalized. The result is a two-track landscape: consumer-protection rules already in force, while the tax side of the framework awaits its operational details.

Cho argued that the decree should be withheld until the National Assembly decides how the tax will function, framing the matter as one for lawmakers to settle. Ahead of the legislated January 2027 start, the developments to watch are whether the National Assembly takes up the question of the tax's mechanics and how the decree-drafting process moves forward from here.

This content was first published on COINOTAG: https://en.coinotag.com/cho-seung-rae-digital-asset-tax-decree-delay-2027