An important committee of parliament approved changes that would delay the implementation of tax on virtual assets like cryptocurrencies in South Korea. The draft legislation seeks to delay Seoul’s plan to impose a 20-percent levy on gains from crypto transactions.
Major Parties Back Tax Relief for Crypto Investors in South Korea, Ahead Of Election
South Korean lawmakers are taking measures to stop a tax planned on the profits of digital asset investments being collected for an additional year. This decision was supported both by the ruling Democratic Party and the People Power Party (leading opposition).
Korea Joongang Daily reported that the amendments which include an increase in the capital gains tax on real property sales in the face of rising property prices are seen by Korean politicians ahead of next March’s presidential election.
At its Tuesday meeting, the National Assembly’s Strategy and Finance Committee approved the modifications to respective provisions. Following Monday’s approval by the subcommittee taxation of its revisions, the vote was held.
For Crypto Assets, Authorities need to take more time in setting up taxation systems
Two Korean parties agreed to delay the introduction of 20% taxes on virtual assets investments that exceed 2.5 million won ($2,102). Although the government had planned to implement the tax in January 2022, the latest voting suggests that the tax will be delayed until 2023.
As cryptocurrencies are becoming increasingly popular among young voters, who struggle to save money in the face of skyrocketing home prices, the Democratic Party is pushing for this delay. It hopes the party’s raising the capital gains exemption for single-residential owners selling at a price between 900million and 1.2billion won ($1million) will increase home availability.
Representatives from DP argue that Korean tax authorities should be given more time to create a system of taxation for investment in virtual assets. However, Finance Minister Hong Nam-ki opposed the delay, stating that “The government is ready to immediately tax virtual assets.” He nevertheless noted that the executive power will comply with any decision by the parliament, which is expected to vote on the amendments in early December.
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