South Korea’s government is seeking a fourth postponement of its planned tax on cryptocurrency investment gains, shifting the start date from January 2027 to 2029 if lawmakers agree. The move comes only months after authorities had reaffirmed plans to begin taxing digital asset gains in 2027.
The proposed regime would apply a 22% tax to annual crypto gains above 2.5 million won, or about $1,860. That total rate is made up of a 20% income tax and a 2% local tax.
Government backs another two-year delay
Officials said they will consult lawmakers on pushing back implementation by another two years. If approved, it would mark the fourth delay for South Korea’s long-discussed crypto tax.
The latest position signals that the government wants more time before enforcing the levy, despite earlier statements that taxation would begin in January 2027. The proposal keeps the tax itself intact while changing the timetable for when it would begin to apply.
Why officials say 2029 is a better start date
The government linked the proposed delay to the expected start of information exchange with the United States in 2029 under the Crypto-Asset Reporting Framework, or CARF. Officials argued that introducing the tax before that cross-border reporting begins could leave South Korea’s domestic market at a disadvantage compared with overseas markets.
Authorities also said the delay would allow time to reflect changes tied to planned digital asset legislation. In other words, the timing is being presented not only as a tax administration issue but also as part of a broader effort to align crypto rules before the levy takes effect.
Loss relief provision is also planned
Alongside the delay, officials plan to introduce a three-year loss carryforward for crypto investors. That would allow taxpayers to use digital asset losses to offset profits earned during the following three years.
The measure appears aimed at adjusting the tax framework rather than simply deferring it. While the government is seeking more time before collection starts, it is also outlining how gains and losses would be treated once the system is in force.
What happens next
According to the government’s timetable, amendments intended to improve the tax system are expected to be taken up during Parliament’s regular session in 2027. More detailed tax guidance is planned for the first half of 2028.
For now, the next confirmed step is consultation with lawmakers over whether to postpone the January 2027 implementation date. Until that process is complete, the 2029 start remains a government-backed proposal rather than a finalized change.
Source: cointelegraph.com