South Korean investors have secured the 50,000 signatures needed to send a petition seeking another crypto tax delay to the National Assembly for legislative review. Summary 50,000 signatures
South Korean investors have secured the 50,000 signatures needed to send a petition seeking another crypto tax delay to the National Assembly for legislative review.
SummaryThe National Assembly’s public petition calls for the scheduled Jan. 1, 2027, start date to be postponed by two years, while finance officials say preparations for the tax remain underway.
South Korea plans to tax annual income from transferring or lending digital assets at a 20% national rate. A 2% local income tax raises the combined burden to 22%. Each resident receives an annual basic deduction of 2.5 million won, currently worth approximately $1,850.
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The petition crossing the signature threshold requires the National Assembly to refer it to the relevant standing committee. Referral does not change the Income Tax Act, guarantee a committee vote or stop the National Tax Service from preparing for implementation.
South Korea’s electronic petition system gives citizens a formal route to request legislation or changes in government policy. A petition securing 50,000 verified signatures during the collection period becomes eligible for consideration by a National Assembly committee.
The latest petition argues that South Korea lacks adequate systems for calculating gains across domestic exchanges, overseas platforms and private wallets. Its author requested a two-year delay so lawmakers and tax authorities could settle questions involving transaction records, acquisition costs and enforcement.
“Most crypto investors are sitting on heavy losses,” the petitioner claimed, while arguing that immediate taxation could place additional pressure on younger investors. The submission described digital assets as a possible “wealth ladder for young people,” a characterization representing the petitioner’s position and not an official assessment.
Concerns raised in the petition include a possible migration toward offshore exchanges and limited tax revenue during periods of weak trading activity. The document provides no independent estimate showing how much revenue the government would collect or how many investors would move their assets abroad.
A separate petition seeking complete abolition of the crypto tax passed the same 50,000-signature threshold in May. It reached committee review but had not produced a change in the law by Sept. 14, showing that the signature requirement opens a legislative process without determining its result.
The National Tax Service’s current guidance states that income from digital asset transfers and lending will become taxable on Jan. 1, 2027. Parliament approved the latest two-year postponement through an Income Tax Act amendment in December 2024.
Implementation had originally been scheduled for 2022. Successive decisions moved the effective date to 2023, then 2025 and finally 2027. The new petition is seeking what would become the fourth postponement.
For residents, taxable income will equal annual proceeds from sales, exchanges or lending after deducting acquisition costs and eligible transaction expenses. The 2.5 million won deduction applies after annual gains and losses are combined.
Covered income will be classified as “other income” and taxed separately from ordinary comprehensive income. Investors will report the previous year’s taxable crypto income during South Korea’s annual filing period from May 1 through May 31.
Income earned during 2027 would therefore produce the first tax returns in May 2028. As crypto.news previously reported, South Korea retained the January 2027 start date in its finalized tax reform plan, leaving Parliament responsible for passing any new postponement.
The rules cover gains from lending digital assets as well as direct sales. Crypto-to-crypto exchanges can create reportable income because authorities calculate the exchanged asset’s value through a reference cryptocurrency and its corresponding fiat value.
Lee Hyoung-il, the nominee for deputy prime minister and minister of economy and finance, told lawmakers that the National Tax Service planned to issue specific tax standards before the end of 2026, Yonhap News Agency reported.
Lee said officials intended to prevent taxpayers from facing difficulties when filing. He defended classifying crypto gains as other income, citing compliance costs, a basic deduction and the use of a single tax rate.
The nominee compared the planned crypto regime with taxes already imposed on certain stock transactions and gains from overseas, unlisted or large-shareholder equity holdings. He said taxing digital assets would improve tax equity, presenting the government’s policy position before his confirmation hearing scheduled for Sept. 15.
Several calculation questions are already addressed in National Tax Service guidance. For assets held before the tax begins, the acquisition value will generally be the higher of the investor’s documented purchase price or the market value recorded on Dec. 31, 2026.
When an investor cannot establish the actual acquisition cost for assets bought after implementation, regulations may permit deemed expenses calculated as a portion of the sale value. Precise eligibility standards and the permitted ratio remain subject to subordinate rules.
Foreign platforms and self-custodied assets do not receive a general exemption. In related coverage, tax authorities confirmed that private wallets and overseas exchange accounts remain within the planned regime.
South Korea’s National Tax Service has acknowledged that directly identifying every unreported private-wallet transaction is difficult. The agency has told lawmakers that it plans to obtain commercial tools capable of tracing movements between blockchain addresses.
As crypto.news reported, the tax agency plans to use wallet-tracing software before the 2027 rollout. Similar software is used by law enforcement and tax authorities to connect transactions across public blockchains.
Transaction tracing does not by itself identify the beneficial owner of every wallet. Exchanges, banking records, transfer histories and taxpayer disclosures may provide supporting information when authorities attempt to connect blockchain addresses with individuals.
South Korea expects international reporting to supply another source of data. Participating jurisdictions intend to exchange information under the Organisation for Economic Co-operation and Development’s Crypto-Asset Reporting Framework, with data exchanged in 2028 expected to cover eligible transactions conducted during 2027.
Rules for income from staking, airdrops and blockchain forks remain less settled than the treatment of transfers and lending. The government has said detailed standards will address areas requiring clarification before taxpayers file their first returns.
For the requested delay to take effect, lawmakers must pass another amendment changing the Jan. 1, 2027, commencement date. The National Assembly had not published a committee hearing or vote date for the latest petition as of Sept. 14.
