South Korea's Opposition Seeks to Push 22% Crypto Tax Start Back to 2030

South Korea's main opposition party, the People Power Party (PPP), has introduced legislation to postpone the country's 22% cryptocurrency investment tax by three years, shifting the effective date from Jan. 1, 2027 to Jan. 1, 2030. The bill was filed by PPP lawmaker Jeong Seongguk, days after the government reaffirmed it intends to keep the 2027 start date. Jeong's proposal would amend the Income Tax Act to retain the crypto tax provisions but delay their enforcement until 2030. He says the additional time is needed to complete investor-protection measures, finalize administrative systems, and refine the broader virtual-asset tax framework to reduce confusion and improve certainty for taxpayers. Under current law, starting Jan. 1, 2027, income from the transfer or lending of virtual assets, including Bitcoin and Ethereum, would be categorized as "other income." Annual gains above a 2.5 million won exemption would face a combined 22% levy (20% national tax plus 2% local tax). In the government's 2026 tax proposal example, an investor earning 5 million won in net crypto trading profits would subtract the 2.5 million won allowance, leaving 2.5 million won taxable and resulting in a 550,000 won tax bill. Taxable income earned in 2027 would be reported in May 2028. The delay push sits alongside a separate, more aggressive PPP effort to eliminate the tax entirely. PPP lawmaker Song Eonseok submitted a bill on March 19 to remove the crypto income provisions from the Income Tax Act, effectively repealing the tax. That repeal measure is being reviewed by the National Assembly's Finance and Economic Planning Committee and could advance to a subcommittee. PPP lawmakers argue the structure disadvantages crypto investors compared with most retail stock traders, who are largely outside South Korea's now-abolished financial investment income tax. They also point to the absence of rules allowing crypto trading losses to be carried forward, warning the levy could push activity toward overseas exchanges, DeFi platforms, or peer-to-peer markets. The government has maintained its position. The Ministry of Economy and Finance finalized its 2026 tax reform package on Aug. 3 without adding another delay, though the package still requires National Assembly approval and can be amended. Finance Minister Koo Yuncheol told a National Assembly committee on July 29 that the government plans to proceed with implementation in 2027 and consider refinements after gaining operational experience. Officials say most administrative preparations are complete, noting the National Tax Service has formed a digital asset unit to develop guidance and enforcement. Seoul also expects new cross-border enforcement tools. The government anticipates receiving overseas crypto transaction data next year through the OECD's Crypto-Asset Reporting Framework (CARF). It says 48 jurisdictions, including Japan, Germany, and France, are participating, improving visibility into Korean taxpayers' assets and transactions on foreign platforms. The dispute carries added weight because the tax has already been postponed three times. Enacted in 2020 with an initial start date of Jan. 2022, it was delayed to 2023, then 2025, and later to 2027. Jeong's amendment would extend the timeline again to 2030 while keeping the law in place. With the ruling Democratic Party and the administration backing the 2027 rollout, the repeal bill is seen as a tough sell. Jeong's delay approach offers the opposition an alternative: keep the tax on the statute books while deferring its application for several more years. The legislative fight is unfolding alongside broader regulatory work. Lawmakers and regulators are drafting a consolidated Digital Asset Basic Act intended to merge roughly 10 pending bills, covering stablecoin rules, exchange licensing and oversight, disclosure requirements, trading-system resilience, and other market structure issues. Debates continue over whether won-backed stablecoins should be issued by bank-led consortia and what ownership or licensing limits should apply to major exchanges. Jeong has also advanced separate legislation to allow institutional crypto investment through spot exchange-traded funds. Jeong's amendment will now proceed through the National Assembly process, competing with the PPP's repeal bid and the government-backed 2027 timeline. The outcome will depend on committee deliberations and political negotiations among the opposition, the ruling party, and the finance ministry as regulators work to finalize the broader legal framework for digital assets. Source notes: reporting by MBN and government statements at National Assembly finance committee hearings.