The South Korean government has finally taken a decision that has to some extent provided relief in the crypto community. South Korea chose to suspend taxes on crypto profits. In the latest debate, parliament passed a bill on Tuesday to push back the implementation of crypto taxation by postponing it to January 2023.
Previously South Korea intended to impose a 20% tax on crypto profits of more than 2.5 million annually. Since it was first proposed, it has presented a mixed reaction among the market. Some argue that it will benefit the sector, while others see it as a burden.
In early April this year, Hong Nam-ki’s finance minister had claimed that the crypto tax was unavoidable and ruled out any possible deferral. However, this is seen as unattainable.
Kim Young-jin, Chairman of the Tax Committee believes imposing a tax on the crypto market without clear guidance from the government is not a good idea.
South Korea over the past few years has emerged as one of the leading countries in seeking to regulate the crypto market. The country has recently implemented new Anti-Money Laundering (AML) rules, which have led to some small and medium-sized crypto exchanges having to wrap up their businesses.
The new rules implement strict KYC rules and prohibit any form of shadow trading. Crypto exchanges are required to work with local banks and build real bank accounts for traders, which were only successfully achieved by a few large crypto exchanges by the end of the deadline in September.
Crypto taxation has become one of the most talked about rules today, with some countries like South Korea having formulated new crypto taxation rules while a number of other countries are planning to impose taxes under existing rules.
