South Korea's People Power Party Advocates for Two-Year Crypto Tax Postponement

According to CryptoPotato, South Korea's ruling People Power Party is reportedly pushing for a two-year postponement of taxation on cryptocurrency investment gains. This move appears to be part of the party's campaign for the general election in April. The program was initially scheduled for 2023, then rescheduled to January 2025, and the current request aims to push it to 2027. The People Power Party emphasizes that the government's tax policy protects the public's assets and well-being. A political leader from the party also highlighted the risks of implementing taxation without a solid tax base. The decision to postpone is due to the lack of a regulatory framework similar to stock exchanges and instances where proof of income is handed to virtual asset companies. The postponement is part of the party's election pledge targeting 2030, and the leader believes that at least two years will allow for necessary amendments to be passed and a robust regulatory system to be established. South Korea's new crypto regulations will include crypto custody providers and guidelines for token listings, adding to the initial set of regulations taking effect in July 2024. Last month, a Ministry of Economy and Finance representative hinted at discussions within South Korea's legislative body regarding the abolition of income tax on cryptocurrency assets. This aligns with the administration's broader initiative to eliminate taxes on various financial investments, including stocks and funds. However, the People Power Party is not considering completely abolishing cryptocurrency taxation. Instead, the party proposes harmonizing the crypto tax threshold with that of stocks, advocating for a more equitable tax framework. A 22% tax is imposed on crypto gains exceeding 2.5 million Korean won ($1,875), while stock gains are only taxed beyond 50 million won. In December 2023, South Korea announced a policy mandating high-ranking public officials to disclose their cryptocurrency holdings beginning the following year. This policy aims to mitigate potential conflicts of interest and uphold ethical standards among government officials. Additionally, South Korea's financial oversight head, Lee Bok-hyun, plans to discuss the cryptocurrency industry with U.S. SEC Chairman Gary Gensler, specifically focusing on spot Bitcoin ETFs.