South Korea’s 20% Tax on Crypto Gains Will Take Effect in 2022: Report

South Korean Finance Minister and Deputy Prime Minister Hong Nam-ki said his country is moving ahead with its plan to tax gains on cryptocurrency trading starting in 2022, according to a report in The Korea Times.

• The policy, which will levy a 20% tax on crypto gains of over 2.5 million won (US$2,125) made in a one-year period, was originally supposed to go into effect on Oct. 1, but was delayed due to a lack of taxation infrastructure.
• A previous proposal in September by the ruling Democratic Party of South Korea to delay the taxation policy until 2023 was abandoned, CoinDesk Korea reported.
• “Any further delay in the already postponed enforcement will lead to the loss of public trust in government policy and undermine stability in the legal system,” Hong said at a parliamentary audit of the Ministry of Economy and Finance in Seoul on Wednesday, according to the report.
• NFTs appear to be exempt from the crypto taxes for now, however, because South Korea does not currently classify them as “virtual assets.”
• Meanwhile, crypto exchanges in South Korea were required to register with local authorities by Sept. 24 or else suspend operations.