South Korea’s Democratic Party agreed to delay the implementation of crypto taxation laws, signaling a temporary truce in the heated debate over digital asset regulation in the country, the Korean Herald reported on Dec. 2.
Park Chan-dae, leader of the Democratic Party’s floor and Rep. Park Chan Dae, announced that the two year tax delay for crypto profit would be agreed upon. Park stated during a recent press conference that:
“We have decided to agree to a two-year moratorium on the implementation of the cryptocurrency taxation proposed by the government and ruling party.”
As of 2024, approximately 20% of South Korea’s population — nearly 10 million people — engaged in crypto trading or investment. The country is cautious about the crypto industry despite its high adoption rate.
The nation’s average daily crypto trading volume is estimated at 11.3 trillion won ($8.4 billion), often exceeding that of its stock exchange, the Korea Composite Stock Price Index (KOSPI).
Political agreement
The tax was originally set to go into effect in January. This delay is in line with the government’s proposal. However, People Power Party was seeking a moratorium of three years.
Park’s opposition party has agreed to a short two-year delay but vowed to block new tax cuts for inheritances and gifts, which it claims disproportionately benefit the wealthy.
The agreement marks a shift in the Democratic Party’s position. The Democratic Party had previously argued for raising the tax threshold from 2,5 million won (1,790 USD) to 50,000,000 won ($35.800 USD) instead of delaying the legislation.
Despite the concession on crypto taxation, Park emphasized his party’s opposition to proposed reforms to inheritance and gift taxes. The ruling party and the government plan to reduce the inheritance tax from 50 to 40 percent and increase the threshold of deductions for assets that are passed on from parents to their children.
Debate on fiscal policy
The tax debates come amid broader discussions on South Korea’s fiscal policies.
Last month, Democratic Party leader Rep. Lee Jae-Myung reversed course on a proposed tax on financial investment income, opting instead to support its repeal. The move was aimed at revitalizing the country’s lagging stock market and appeasing millions of investors.
Lee:
“I could not ignore the voices of 15 million financial stock investors who might be affected by structural vulnerability.”
The crypto tax delay provides temporary relief to digital asset traders but raises questions about the government’s ability to balance competing fiscal priorities.
Posted In: South Korea, Featured, Legal, Politics, Regulation Author 
Assad Jafri
AJ is a dedicated journalist who has spent over a decade honing his craft in various countries. Specialized in financial journalism and crypto reporting, he is now focused on this area.
Email: @Saajthebard Editor
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