Kim Min-seok: Many Voices Called for Deferring Virtual Asset Taxation at Party-Government Meeting

The Democratic Party of Korea and the government held a party-government consultative meeting on virtual asset taxation at the National Assembly on the 28th to discuss whether to defer the taxation of virtual assets (taxes imposed on virtual currencies, etc.) set to take effect in January next year, but failed to reach a conclusion. Attending the meeting were Democratic Party Chairman Kim Min-seok, National Assembly Strategy and Finance Committee Chairman Cho Seung-rae, and Deputy Prime Minister and Finance Minister Lee Hyung-il.

Rep. Oh Ki-hyung said after the meeting, "Some argued that since taxation has been deferred three times, it should be enforced this time, while others called for improvements to the system first. We also discussed tax equity between domestic and overseas markets and a review of the framework in light of market changes." Speaking at the party's Supreme Council meeting at the National Assembly shortly after the meeting, Chairman Kim said, "Many opinions suggested that it would be preferable to first refine and improve related systems, and then defer virtual asset taxation for a certain period." He added, "We will go through final discussions to reach a reasonable outcome." Chairman Cho Seung-rae proposed deciding on the deferral first before issuing any announcement, noting that the government's tax-related notice scheduled for the end of this month could be regarded as a declaration of taxation.

Taxation of virtual asset income was introduced through an amendment to the Income Tax Act in December 2020, but has been deferred three times since then. The amended law is centered on a 2.5 million won deduction on gains from the transfer or lending of virtual assets, with a 22 percent tax rate applied including local income tax. Enforcement is scheduled for January 1 next year.