South Korean Government Has Postponed The Implementation Of 20% Crypto Tax Until 2025

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South Korean Government Has Postponed the Crypto Tax

The South Korean government has delayed the implementation of its 20 percent tax on all cryptocurrency revenues until 2025.

First, laws must be passed to safeguard investors. If you’re looking to know more about the postponing of the Crypto Tax then here we have got you covered with everything you should be knowing:

The South Korean Government Reportedly Postponed The Implementation Of The Crypto Tax

When the government of South Korea originally proposed a 20 percent tax on cryptocurrency revenues that would go into effect in January 2023, the law caused a great deal of debate in that country.

President Yun Suk-yeol promised to focus on regulations first, thus it looks like the administration has now postponed matters.

According to a South Korean public broadcast, which is available on YouTube, the tax will be delayed until 2025.

The first proposal to apply a 20% tax on individuals with cryptocurrency earnings surpassing KRW 2.5 million ($1,900) over the course of a year will stand.

Given that the threshold for capital gains in the regular stock market is far higher, a source told Coindesk that one rationale for the 20 percent tax deferment might be that smaller crypto investors would be disproportionately targeted.

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Since it was initially announced in January 2021, the South Korean government has already postponed the crypto tax twice. It was planned to take effect in 2022 but was postponed until 2023. It has now been postponed till 2025 by an additional two years.

As a recently elected pro-crypto president, Yun Suk-yeol probably wants to ensure that regulation is sound before enacting any additional levies.

South Korean Government Has Postponed the Crypto Tax

Other nations with contentious crypto taxes in place have seen some major issues. For instance, Thailand proposed a 15 percent tax on cryptocurrency earnings, but the country’s crypto business forced the government to abandon the plan.

When it began taxing cryptocurrencies at a rate of 30% in April of this year, the Indian government took things a significant step further.

However, the onerous tax forced many people to cease trading, and within weeks of the new tax’s implementation, Indian cryptocurrency exchanges lost more than 90% of their trading activity.

Crypto Tax Is Opposed By Investors In Their Twenties And Thirties

Although no particular taxes guidelines for crypto assets have been established, the ministry of finance is considering reclassifying cryptocurrency earnings as a sort of ‘other income.’

This placed cryptocurrency gains in the same category as lottery profits, which are taxed at a rate of 20%.

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Given the increased tax rate on ‘other income,’ it is still preferable to just be taxed as a kind of capital gains, as it is presently classified, that provides for rates of up to 42 percent.

South Korea has historically been one of the most active cryptocurrency investment and trading markets. Nonetheless, authorities have already been reticent to regulate the virtual asset class because they believe that doing so will provide credibility to the industry.

Furthermore, the central bank is currently adopting a ‘wait-and-see’ posture on the topic of a government-controlled cryptocurrency, generally known as a central bank digital currency (CBDC).

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