South Korea May Suspend Crypto Tax Again: 2029 Now the Leading Target Date

South Korea is likely to postpone its crypto income tax for a fourth time, as Newsis reported on October 26, after an official from the presidential office, also known as the Blue House, confirmed that a delay is under discussion. January 2029, when the United States is due to join the OECD’s crypto information-sharing network, is the most probable new start date. “Taxation of virtual assets is being discussed with a view to delaying implementation,” a Blue House official stated on October 25. Lawmakers and the government are expected to amend the Income Tax Act during the tax law reform debate that begins in November, with consultations with relevant organizations starting as early as October 26. A government official said the final call will probably come between late November and early December. At the center of the case sits the United States. Almost half of the virtual asset market is there, the official pointed out, and “the biggest obstacle is that the United States does not provide us with taxation information.” Without that data, tax officers would have to trace American exchange activity one account at a time, and the tax could end up falling mostly on users of domestic exchanges. The OECD’s Crypto-Asset Reporting Framework (CARF) starts running next year, with 46 countries including South Korea beginning data exchanges. Canada, Switzerland, Hong Kong, and Singapore are among 29 countries that join in 2028, with Washington’s first exchange set for 2029. Seoul initially favored a January 2027 start, arguing that overseas financial account reporting could help collect foreign tax information, but calls for a moratorium from both the opposition and the ruling party, along with related bills, shifted the government toward suspension. Introduced in 2020 through an Income Tax Act revision, the levy takes 22% (local taxes included) of gains above 2.5 million won, about $1,886, once acquisition costs are deducted. But the Korean parliament has already suspended it three times. Public pressure is building too. A petition seeking a two-year postponement reached the 50,000-signature threshold on the National Assembly’s electronic petition system, which sends such petitions to a standing committee for review. An anonymous petitioner wrote that “most crypto investors are sitting on heavy losses” and that taxing now is unfair to young people. The petition also argued that the tax would push investors to offshore platforms, though as CryptoPotato reported, regulators ordered blocks on 27 overseas exchanges on October 13, KuCoin and MEXC among them. A May petition to abolish the tax reached 50,000 signatures in eight days but went no further after referral to a committee. The proposed 2029 date is