South Korean lawmakers have requested a delay for the implementation of the crypto taxation, but Finance Minister Hong Nam-Ki said at the National Assembly that the government will pursue its original schedule for the tax plan.
He said that the government’s plan to tax the capital gains of cryptocurrency transactions should be implemented as soon as possible.
According to the government, the amended law would tax 20% citizens who earn crypto revenue amounting to 2.5 million won (around US$2,132). The law is set to be implemented on January 1, 2022.
No to delay
“The virtual asset market has grown to be as big as the KOSPI (Korea’s stock market). It would be a problem for fair taxation if we do not tax where there is income,” Hong said.
The minister also said that delaying the crypto tax law would result in market confusion that can cause even bigger problems.
But even with the good intentions of the law amendment, it has sparked criticisms from some lawmakers, government officials, analysts, and investors who said the implementation of the new law might be too premature.
Unfair tax amendment?
Crypto investors even said that the law is totally unfair as stock capital gains are only taxed if it reaches 50 million won, while crypto income is immediately taxed if it reaches 2.5 million won.
The government explained that since virtual assets are not yet recognized as financial assets in the country, it had to implement a lower threshold for the deduction on cryptocurrencies.
One more thing that causes anger among crypto investors is that the taxation of stock capital gains is planned to be implemented in 2023, a year later than crypto taxation.
A growing number of investors are expressing their dismay over the “unfair” treatment between crypto and stock gains from the government.
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