South Korea’s ruling Democratic Party (DP) has formally asked the government to postpone the crypto gains tax scheduled for January 1, 2027. If approved, it would be the fourth delay of a levy already written into law since 2020. The party’s argument: pass a comprehensive digital asset framework first, then apply the tax.
🔑 Key takeaways
- On November 4, 2026, the DP proposed postponing the crypto gains tax due January 1, 2027.
- The announced rate is 20% plus a 2% local tax, or 22% in total, above a 2.5 million won basic deduction.
- A delay would require parliament to amend the income tax law before the deadline.
- Internal discussions point to roughly two years, implying 2029, but no formal period has been set.
A Two-Step Decision
The proposal came in two steps. On November 3, 2026, members of the relevant parliamentary committee recommended the delay to the party leadership. On November 4, the party’s Supreme Council formally submitted it to the government. Sources do not give the committee’s name identically, but all describe a preparatory step before leadership validation.
The planned regime would apply to annual gains from transferring or lending crypto-assets above a basic deduction of 2.5 million won. Beyond that threshold, the announced rate is 20%, plus a 2% local tax, for a total of 22%. Media conversions put the threshold at about $1,860 in the Korea JoongAng Daily, $1,868.70 in The Block and $1,880 in the Korea Times and Yonhap. The differences reflect only the exchange rates used.
The tax was written into the income tax law in 2020, with a first application planned for 2022. It has already been deferred three times before the current January 1, 2027 deadline. A further delay would require a vote in the National Assembly. The party’s decision is therefore not yet a government or parliamentary decision.
The Two Reasons Behind the Proposal
The party cites two main reasons. The first is the prior adoption of the Basic Act on Digital Assets, also called the general law or digital asset framework. The bill is meant to set rules for the whole market, including exchanges and stablecoins (tokens pegged to a currency). It is separate from the Virtual Asset User Protection Act, which took effect in July 2024.
A Legislative Framework Still Under Construction
The draft would reportedly include rules on stablecoin issuance and was still awaiting review by the National Policy Committee at the end of July. According to compliance firm Sumsub, ten bills were pending in parliament at that point. The firm also flagged a dispute over whether banks should control issuers of won-denominated stablecoins. Oh Gi-hyoung, a member of the finance and budget committee, said the law could take effect in the first half of 2027.
“We believe it would be better to first adopt the Basic Act on Digital Assets to establish a comprehensive framework and give businesses and investors time to adapt.”
Kim Min-seok, Leader, Democratic Party
The International Tax Reporting Timeline
The second reason concerns the international calendar for exchanging tax information on crypto-assets. The report behind the 2029 timeline does not name this mechanism, but it could be the Crypto-Asset Reporting Framework of the Organisation for Economic Co-operation and Development (OECD), adopted in 2022 and finalised for global rollout in 2023. According to CoinDesk, several dozen early-adopting countries began collecting data in 2026 for exchange in 2027, while the United States is not expected to join before 2029.
The Delay Window: Two Years Discussed, No Official Figure
Kim did not specify how long the delay would last. Oh Gi-hyoung, however, said internal discussion centred on a period of about two years. CoinDesk and KuCoin present the move as a delay to 2029, but that date reflects the timeline Oh discussed publicly, not a period formally set by the party. The table below summarises the known parameters.
| Item | Current status |
|---|---|
| Basic deduction | 2.5 million won (about $1,860 to $1,880) |
| Applicable rate | 20% plus 2% local tax = 22% |
| Effective date | January 1, 2027 |
| Previous deferrals | 3, with a fourth proposed |
| Discussed duration | About 2 years, or 2029, not formalised |
“Most members seem to be talking about roughly two years.”
Oh Gi-hyoung, Member, Finance and Budget Committee
Preparations, Political Positions and Regional Comparison
The party listed the preparations it wants completed before the tax applies. They include:
- use of transaction data from overseas platforms;
- IT-based verification of transactions;
- a tax simulation based on real transaction data;
- taxpayer support, and a test of sharing tax data between the National Tax Service and exchanges.
The delay will be revisited in future discussions on amendments to the income tax law within the parliamentary tax subcommittee. Within the executive, Finance Minister Lee Hyoung-il favours keeping the January 1, 2027 date. By contrast, the exchange group DAXA has requested a delay. According to The Block, the presidential office reportedly discussed postponing to 2029 the week before, to align South Korea’s timetable with that of the United States, but this was not presented as a firm government decision.
In the region, Japanese media report that Tokyo is preparing a uniform 20% tax on crypto gains, compared with rates that can reach 55% today, along with a reclassification of some tokens under securities law. Hong Kong and Singapore already operate licensing regimes for crypto-asset platforms.
Conclusion: A Timeline Tied to Legislation
The DP proposal does not settle the question. It opens a parliamentary debate whose outcome depends on passing the Basic Act on Digital Assets, reforming the income tax law and the position of the executive. Three scenarios remain open: keeping the January 1, 2027 date if the government and parliament judge the infrastructure ready; a delay of roughly two years, consistent with the OECD calendar; or a partial compromise, with an effective date tied to the completion of data-sharing controls.
For platforms and investors, the trajectory remains that of a tax framework being defined in stages. The most concrete signal will be the parliamentary review schedule and the progress of the digital asset law.
Sources
- CoinDesk, November 4, 2026
- The Block, November 3, 2026
- Korea Times, November 4, 2026
- Korea JoongAng Daily
- Yonhap News Agency, November 4, 2026
- KuCoin News
Cet article est publié à titre informatif et éducatif. Il ne constitue en aucun cas un conseil en investissement. Faites vos propres recherches (DYOR) avant toute décision.
