--- title: "South Korea's Ruling Party Formally Proposes Delaying Crypto Income Tax" description: "Democratic Party chief Kim Min-seok cited the need to enact foundational digital asset regulations before taxing virtual asset gains." url: https://basisdesk.news/news/south-korea-ruling-party-proposes-crypto-tax-delay published: 2026-11-04T10:46:35.321Z modified: 2026-11-04T10:46:35.321Z section: Regulation & Policy author: Basis Desk Newsroom (AI-generated, source-verified) sentiment: neutral tickers: [BTC] tags: [south-korea, taxation, regulation, national-assembly, income-tax] license: Quote with attribution to Basis Desk (basisdesk.news). Not financial advice. --- # South Korea's Ruling Party Formally Proposes Delaying Crypto Income Tax Democratic Party chief Kim Min-seok cited the need to enact foundational digital asset regulations before taxing virtual asset gains. ## At a glance - **What happened:** South Korea's ruling Democratic Party formally proposed deferring the 22% virtual asset income tax on Nov. 4. - **Why it matters:** Enforcement of the tax regime remains on hold pending the passage of the broader Digital Asset Basic Act framework. - **Who is affected:** South Korean crypto investors, domestic virtual asset exchanges, and the Ministry of Economy and Finance. - **Takes effect:** 2027-01-01 - **What's next:** The National Assembly must consider an amendment to the Income Tax Act before Jan. 1, 2027. - **Status:** proposed - **Primary source:** [Korea’s Democrats Back a Crypto Tax Delay, Promise a Firm End Date They Haven’t Named](https://unchainedcrypto.com/koreas-democrats-back-a-crypto-tax-delay-promise-a-firm-end-date-they-havent-named/) — unchainedcrypto.com ## Key points - South Korea's Democratic Party formally proposed deferring the 22% virtual asset income tax scheduled for Jan. 1, 2027. - Party leader Kim Min-seok said the Digital Asset Basic Act must be enacted before gains are taxed, though no deferral length was specified. - The tax delay requires an amendment to the Income Tax Act by the National Assembly before Jan. 1, 2027, to become law. ## Editorial remark - **Context:** South Korea first approved taxing crypto income above 2.5 million won at 22% via a 2020 revision to the Income Tax Act, but lawmakers have delayed enforcement three times. - **Impact:** Domestic crypto exchanges and retail investors gain extended tax relief and compliance runway while lawmakers work to structure the foundational Digital Asset Basic Act. - **Watch:** A formal legislative amendment to the Income Tax Act in the National Assembly and joint party-government discussions regarding whether to postpone to 2029. South Korea's ruling Democratic Party officially proposed postponing the implementation of the country's virtual asset income tax on Nov. 4, pending the passage of broader sector legislation [1]. The 22% levy on crypto gains exceeding 2.5 million won was scheduled to take effect on Jan. 1, 2027 [1]. Speaking at a Supreme Council meeting in the National Assembly, Democratic Party leader Kim Min-seok stated that taxation should follow the passage of the Digital Asset Basic Act to allow market participants an adaptation period [1]. Kim noted that the position followed consultations between ruling lawmakers and the government, centered on the Assembly's finance committee, as well as meetings with local crypto businesses [1]. Lawmakers had previously held talks as the government weighed [pushing the gains tax to 2029](https://basisdesk.news/news/south-korea-considers-fourth-delay-crypto-tax-2029) in what would be a fourth deferral [1]. At the time of writing, $BTC traded at $78,423, up 2.0% over 24 hours. ## Regulatory Framework Before Taxation Although Kim pledged a definite end date for this deferral, party leadership did not announce a specific timeframe [1]. Committee lawmakers have primarily discussed a two-year extension, while government officials previously considered shifting the effective date to January 2029 [1]. Kim emphasized that the party intends to finalize preparatory measures during the deferral window, including handling cross-border transaction data, computer verification systems, and taxpayer guidance [1]. The postponement proposal does not yet carry the force of law [1]. The National Assembly must formally amend the Income Tax Act before Jan. 1, 2027, to suspend the regime, which was first enacted under a 2020 legal revision and has been delayed three times [1]. Deputy Prime Minister and Finance Minister Lee Hyung-il previously told an Oct. 22 audit that the government would decide its position after careful deliberation [1]. ## FAQ **What is South Korea's scheduled crypto income tax?** The policy mandates a 22% combined local and national tax rate on virtual asset capital gains exceeding 2.5 million won, originally slated to start on Jan. 1, 2027. **Why is the Democratic Party seeking a postponement?** Party leadership stated that the Digital Asset Basic Act must first be passed to establish regulatory standards and technical infrastructure, such as cross-border tracking. **Is the tax delay legally finalized?** No. The National Assembly must formally vote to amend the Income Tax Act prior to the Jan. 1, 2027, statutory effective date. ## Sources 1. [Korea’s Democrats Back a Crypto Tax Delay, Promise a Firm End Date They Haven’t Named](https://unchainedcrypto.com/koreas-democrats-back-a-crypto-tax-delay-promise-a-firm-end-date-they-havent-named/) — unchainedcrypto.com, 2026-11-04 --- Basis Desk Newsroom · AI-generated, source-verified · https://basisdesk.news/about/how-we-use-ai