South Korea to Review Crypto Tax After Petition Tops 50,000 Signatures

More than 52,000 South Koreans have signed a petition urging the government to drop its planned cryptocurrency tax, surpassing the threshold that requires a formal parliamentary review. The petition cleared 50,000 signatures on May 21, 2026, about eight days after launch. Under South Korea's petition rules, that figure triggers a mandatory referral to the National Assembly's Finance and Economic Planning Committee for deliberation. At the center of the backlash is a proposed 22% levy on crypto gains, comprising 20% national income tax and 2% local tax. The tax would apply to annual profits above 2.5 million won, roughly $1,650–$2,200 depending on exchange rates. Critics say the exemption level is the core problem. For traditional financial assets such as stocks, the tax-free threshold is around 50 million won—about 20 times higher than what's proposed for crypto. Petitioners argue this creates an uneven playing field that hits retail crypto investors, who tend to be younger, while leaving stock investors with a far more generous allowance. The petition also points to gaps in investor protection. Opponents argue the government is seeking to tax crypto like a mature asset class while regulatory safeguards against fraud, exchange failures, and market manipulation remain less developed than those governing stock markets. South Korea first floated the crypto tax around 2022, but implementation has been postponed repeatedly. The latest target date is January 2027, following delays that have tracked political pressure and shifts in sentiment in a country known for heavy retail crypto trading. Political resistance has intensified. The opposition People Power Party has introduced legislation to permanently abolish digital asset income tax provisions, rather than adjust or delay them again. The bill's prospects are unclear, but its introduction raises the stakes for negotiations. Authorities have signaled they still plan to proceed with the tax. The committee review mandated by the petition adds structured scrutiny, moving the issue from administrative intent toward a formal legislative debate. For investors, the outcome could shape participation in one of the world's most active retail crypto markets—a market historically associated with the "Kimchi premium," the price gap between Korean exchanges and global venues. If the 22% tax takes effect in January 2027, some traders may cut exposure or look for workarounds, with younger investors likely to feel the impact most. The growing political pushback also increases uncertainty around timing. Another delay would fit the established pattern, and if the People Power Party's abolition effort gains momentum, the framework could be scrapped before collecting any revenue. The committee review does not predetermine the outcome, but collecting more than 52,000 signatures in eight days signals rising political costs. With South Korea heading toward its next general election cycle, the debate could test whether crypto policy has become a meaningful ballot-box issue.