Home Business Regulation 20 percent crypto tax implementation to begin soon in South Korea

20 percent crypto tax implementation to begin soon in South Korea

South Korean government is said to be working on implementing a 20% tax on all income from cryptocurrency. The process which was drawn by the Ministry of Economy and Finance will classify gains from cryptocurrency as other income such as lottery or prize-winning subjected to tax.

According to an anonymous government source also, the development points to the government treating income from cryptocurrency trading as “other income”.

The finance ministry is yet to finalize its direction but it surely has become more likely for the income from virtual asset trading to be labeled as other income, not as gains from transfer of capitals like real estate properties,” he said.

Before now, the project was overseen by the property tax department, which oversees taxation on capital gains and gifts before the ministry took over. The income tax department oversees taxation on incomes such as earned income, other income, and annuity income.

Categorizing gains from trading cryptocurrencies such as bitcoins and ethereum as other income has also raised speculations among experts.

South Korea crypto tax, a needed development

South Korea is remarkably part of the countries earning most as regards crypto as the country holds 20% of the global cryptocurrency market with major exchanges like Bithumb and BitGo.

South Korea crypto industry has also been one without clear regulations making taxation impossible. NTS had taxed the top exchange in November 2019 for trade of its foreign customers. Although the exchange paid the tax, it later decided to challenge the service in court as there was no law supporting taxation of exchanges on foreign customers’ trade. 

Reportedly, other income in which crypto earnings are categorized is subject to a 20% tax on 40% of total other income and the remaining 60% is still tax-deductible.

Towards stabilizing the industry, South Korea crypto tax plan is branded a good project as the government will be able to generate income from the industry. However, more is required to make the industry more stable. So far, the industry has been running with international regulations as there are no solid regulations in South Korea up to this point.

It is said that if proper regulation eventually comes to South Korea, it is likely to boost the industry in the country and further increase Asia’s ranking as a hub for blockchain technology and cryptocurrency.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Must Read

Bitgo Plans to Launch Wrapped Bitcoin on the Tron Blockchain

Members of the crypto ecosystem will soon be able to leverage WBTC via the Tron (TRX) network. Just like the tokenized BTC created using Ethereum’s ERC20...

Ethereum’s Long Term Chart Is Extremely Simple To Read

The weekly Ethereum chart, as opposed to the daily chart, is simple and concise. There are 2 simple...

US Department of Transportation Says Blockchain Has Many Applications For Unmanned Aircraft Systems (Drones)

Blockchain technology could assist with adjusting and improving current technical challenges in the expanding business of commercial drone delivery, said the US...

Security tokens, blockchain settlement draw interest from institutions: MIT Bitcoin Expo panel

Amid growing competition between providers, institutions in the traditional finance space are looking at blockchain as another way to offer value to...

Networking 2.0 at Blockchain Life 2020

Make hundreds of connections at Blockchain Life 2020 The 5th Blockchain Life 2020 returns to Moscow on April 22-23 at the unique media...