South Korea lawmakers push for another crypto tax delay until 2029
South Korea’s ruling-party lawmakers have recommended delaying cryptocurrency income taxation again, potentially shifting its scheduled start from January 1, 2027, to 2029. The proposal reflects lingering questions about overseas transaction records and reporting systems. Tax officials say gaps in the data do not make enforcement impossible.
- Proposed: Most committee members reportedly favored a delay of about two years.
- Not approved: The legal start date remains January 1, 2027, unless parliament amends the Income Tax Act.
- At issue: Overseas records, exchange readiness and pending digital-asset legislation.
A recommendation is not a change in the law
Seoul Economic Daily reported that most Democratic Party members of a National Assembly committee overseeing finance and economic affairs favored recommending a delay of roughly two years after meeting with government officials on November 3. That would put a 2029 start in view, potentially on January 1.
The report described a recommendation, not a final decision or a formal change to the law. Democratic Party leadership and its policy committee were expected to review the proposal within one to two weeks. The reported updates do not show that the recommendation was later adopted or that parliament amended the Income Tax Act.
South Korea approved its crypto income tax framework in 2020. The planned start was later pushed from January 2022 to 2023, then to 2025 and finally to 2027. If lawmakers approve another delay, it would be the fourth postponement.
Democratic Party lawmaker Oh Ki-hyung backed the principle of taxing crypto income but said more preparation was needed:
“We agree with the tax principle that income should be taxed where it arises, ”
His position highlights the debate’s central distinction: supporting taxation in principle does not mean supporting the current implementation date.
What the current tax framework says
According to Crypto.news’ account of the rules, individuals would pay a 20% tax on qualifying annual cryptocurrency income above 2.5 million won. Local income tax would bring the combined rate to 22%. The rate applies to taxable income above the threshold, not to an investor’s entire portfolio or the gross value of every trade.
The reported framework covers income from selling or lending cryptocurrency. Gains and losses can be offset within the same tax year, but losses cannot be carried forward. If the current schedule holds, income earned in 2027 would be reported in May 2028, Crypto.news reported.
To calculate a gain, taxpayers generally compare sale proceeds with an asset’s cost basis, the amount used to determine what it cost to acquire. That can be difficult when someone transfers crypto from an overseas platform to a South Korean exchange without records of the original purchase price.
The reporting describes this as an implementation problem but does not set out one alternative calculation method for every case with missing records. Incomplete documentation does not automatically mean a gain cannot be taxed, and it does not settle how a particular taxpayer’s liability would be calculated.
CARF could improve information sharing, but it does not set tax policy
Lawmakers have cited the Crypto-Asset Reporting Framework, or CARF, as one reason to allow more time. Developed by the Organisation for Economic Co-operation and Development, CARF is designed to support the exchange of tax-relevant information about crypto transactions between jurisdictions.
Crypto.news reported that South Korea is scheduled to begin exchanging information under CARF in 2027, while the United States is expected to participate from 2029. These are reported schedules for information exchange. They do not automatically determine when South Korea can tax crypto income.
Information exchange also does not guarantee a complete history of every asset. Transfers between foreign platforms, domestic exchanges and self-custody wallets can leave gaps. Data shared between tax authorities may not show an asset’s original acquisition cost.
The National Tax Service has rejected the suggestion that incomplete overseas records make taxation unworkable. Deputy Commissioner Park Hae-young said the agency could use available foreign account information and CARF data to reduce reporting gaps, according to Crypto.news. That is the tax authority’s position, but it does not mean every case with a missing cost basis already has a clear answer.
Exchanges and pending legislation add to the uncertainty
Reporting systems also need to work in practice. Bithumb estimated that developing and testing its tax-reporting infrastructure could take six to nine months after authorities provide a suitable testing environment, Crypto.news reported. The estimate covered data accuracy, integration with tax authority systems and operational stability. It reflects one exchange’s assessment, not an industry-wide timeline.
Lawmakers have also raised concerns about the planned Digital Asset Basic Act, which is expected to address crypto businesses, transaction structures and other parts of the market. The reporting did not give a formal introduction date or explain how the bill’s final provisions might affect tax rules.
On October 16, Democratic Party lawmaker Park Min-gyu introduced a separate bill linking the tax start date to CARF data exchanges, according to Crypto.news. Under the reported proposal, taxation would begin on January 1 of the second year after the first qualifying exchange of crypto transaction data. For example, if that first exchange happened in 2027, the proposed start date would be January 1, 2029. The bill’s trigger differs from simply setting a fixed 2029 date.
Opposition People Power Party lawmakers have proposed either a further delay or repeal. They are different options: a delay keeps the tax but moves its start date, while repeal removes the tax provisions.
The National Tax Service was also preparing guidance on staking rewards, airdrops, hard forks and decentralized finance transactions. Tax Commissioner Lim Gwang-hyeon said at an October 13 parliamentary hearing that the agency was working with exchanges and government officials on how to treat different transactions. His statement described work in progress and does not confirm whether the guidance was later issued.
Key questions about South Korea’s crypto tax
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Has South Korea delayed the crypto tax until 2029?
The reported updates do not establish an approved change. The current scheduled start remains January 1, 2027, unless parliament amends the Income Tax Act.
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What tax rate is currently planned?
The reported framework applies a 20% tax to qualifying annual crypto income above 2.5 million won. Local income tax brings the combined rate to 22%.
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Does CARF require South Korea to wait before taxing crypto?
No. CARF covers cross-border information reporting. It does not impose South Korean tax or automatically set the tax’s start date.
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Can the tax authority assess gains when overseas records are incomplete?
The National Tax Service says foreign account information and CARF data could help fill reporting gaps. The available reporting does not establish a universal way to calculate gains when acquisition records are missing.
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What other tax rules still need clarification?
The National Tax Service said it was working on guidance for staking rewards, airdrops, hard forks and decentralized finance transactions. Its October 13 statement does not confirm whether that guidance was later published.
More preparation may help; repeated delays keep the rules uncertain
More time could give exchanges a chance to test reporting systems and let authorities clarify how different transactions should be treated. Missing acquisition records are a real administrative problem, especially when crypto has moved through overseas platforms and wallets.
Another delay would also extend the period in which investors and businesses have to plan around a tax date that has shifted repeatedly. The National Tax Service says imperfect overseas data need not prevent enforcement. Lawmakers argue the system still needs preparation. Until parliament acts, January 1, 2027, remains the reported statutory start date.
