South Korea confirms that starting January 1, 2027, it will tax cryptocurrency gains, ending years of debate.

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Mars Finance News, May 8 — The South Korean Ministry of Economy and Finance has officially confirmed that, starting January 1, 2027, it will levy taxes on profits from cryptocurrency trading, bringing an end to years of political debate and repeated postponements over the digital asset tax framework. The decision was announced by Moon Kyung-ho, Director of the Income Tax Division, at an emergency forum on digital asset taxation held at the Seoul National Assembly Building.

According to South Korea’s Income Tax Act, beginning in 2027, profits generated from the transfer or lending of digital assets will be classified as “other income.” For the portion of annual crypto gains exceeding 2.5 million won (approximately $1,800), a combined tax rate of 22% will apply (including 20% national income tax and 2% local income tax). The government estimates that this policy will affect about 13.26 million cryptocurrency investors.

Although opposition parties and some industry participants have called for the tax to be completely repealed or further delayed, arguing that it unfairly treats stock investment income—tax on which was abolished at the end of 2024—the government said it will move forward as planned. The National Tax Service (NTS) is finalizing operational guidelines and has coordinated technical reports and compliance systems with the country’s five largest exchanges. Detailed legislative guidance—including reporting obligations for trading platforms, investor disclosures, and the standards for handling staking, lending, and airdrop earnings—is expected to be released within 2026.

Meanwhile, South Korea is tightening comprehensive regulation of the digital asset market. Recently, it amended the Foreign Exchange Transactions Act to bring overseas crypto transfers and cross-border activities within the expanded regulatory scope. Analysts believe that South Korea’s implementation model may become a benchmark for other regulatory authorities in Asia.

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