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<p>To support the growth of its emerging cryptocurrency market, South Korean lawmakers have approved a delay in implementing a capital gains tax on digital assets until January 2027.</p>
<p>The decision follows extensive consultations with industry experts and investors.</p>
<p>Democratic Party leader Park Chan-dae announced the decision, stating, <em>“We understand the importance of developing the cryptocurrency sector in South Korea, but we also believe it is crucial to protect small investors. Delaying the tax for two years will give the market time to stabilize and grow.”</em></p>
<h3 class="wp-block-heading" id="h-diverging-proposals-on-taxation">Diverging Proposals on Taxation</h3>
<p>The government initially proposed a two-year delay, while the ruling People Power Party suggested a three-year postponement. However, the Democratic Party opposed both proposals and instead advocated for increased tax exemptions on cryptocurrency profits.</p>
<p>Their initial proposal aimed to raise the tax-free threshold on digital asset gains to 50 million won, a significant increase from the current threshold of 2.5 million won. The party argued this adjustment could address the concerns of small investors without deferring the law’s implementation.</p>
<p>Despite the compromise on the delay, Park confirmed that the Democratic Party remains opposed to the government’s inheritance and gift tax reform bill, which he described as favoring the wealthy at the expense of the middle class.</p>
<p>It is worth noting that last month, Democratic Party representative Lee Jae-myung expressed his support for the government’s decision to cancel a proposed financial investment tax. He raised concerns about the potential negative impact on South Korea’s 15 million financial market investors, emphasizing their voices could not be ignored.</p>
<h3 class="wp-block-heading" id="h-booming-crypto-market-highlights-need-for-regulation">Booming Crypto Market Highlights Need for Regulation</h3>
<p>Data from South Korea’s Financial Services Commission underscores the rapid growth of the nation’s cryptocurrency market.</p>
<p>Daily trading volume surged 67% during the first half of 2024, reaching six trillion won, while the number of investors grew by 21% to 7.78 million. Bitcoin and Ethereum remain dominant in trading activity.</p>
<p>The significant expansion has heightened the urgency for balanced regulatory frameworks that support growth while ensuring market stability and investor protection.</p>
<h3 class="wp-block-heading" id="h-regulatory-steps-forward">Regulatory Steps Forward</h3>
<p>In October, Finance Minister Choi Sang-mok introduced a new regulatory plan for digital assets and stablecoins. The proposed framework requires cryptocurrency companies to register with authorities and submit monthly transaction reports to the Bank of Korea.</p>
<p>This regulatory approach aims to establish a transparent and stable environment for cryptocurrency businesses and users, reflecting South Korea’s will to enhancing innovation while safeguarding its financial ecosystem.</p>
<p>The post <a href="https://www.unlock-bc.com/133558/south-korea-delays-crypto-capital-gains-tax-to-2027/" rel="noopener noreferrer nofollow">South Korea Delays Crypto Capital Gains Tax to 2027</a> appeared first on <a href="https://www.unlock-bc.com" rel="noopener noreferrer nofollow">UNLOCK Blockchain</a>.</p>

South Korea Delays Crypto Capital Gains Tax to 2027

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