South Korea has finally announced its long-delayed cryptocurrency tax. The country's Ministry of Finance confirmed that the tax on virtual asset gains will go into effect as planned in January 2027. This marks one of the first clear public statements from the government regarding the regulation, which has been postponed several times. The announcement came at an emergency virtual asset taxation forum held at the National Assembly Members' Office Building in Seoul. According to Edaily, a South Korean news outlet, the forum was organized by People's Power Party lawmaker Park Soo-young and the Korea Tax Policy Association. Moon Kyung-ho, Director of the Income Tax Office at the Ministry of Finance, stated, "We will implement the virtual asset taxation as planned in January of next year." Under the current Income Tax Law, gains from the transfer or lending of crypto assets will be categorized as "other income" starting January 1, 2027. Investors whose annual crypto earnings exceed 2.5 million won, or approximately $1,800, will be subject to tax. The tax rate will be 22% overall. 20% of this will be income tax, and 2% will be local tax.
The regulation is said to affect approximately 13.26 million investors. This number also shows how broad an individual investor base the crypto market has reached in South Korea. In recent years, transactions made through large platforms such as Upbit and Bithumb have become more of a focus for both regulators and politicians in the country.
Tax guide to be published in 2026
Moon Kyung-ho said that the National Tax Service is continuing its preparations for the new system. It was reported that the institution held multiple working-level meetings with the country's five largest cryptocurrency exchanges. These exchanges include Upbit, Bithumb, Coinone, Korbit, and Gopax, all operated by Dunamu. The draft notification is expected to be submitted to legislative review in 2026. In his statement to reporters after the forum, Moon retracted the word "soon," clarifying that the notification will be published later in the year, not immediately. This detail shows that the technical framework of the application is still in the final stages.
South Korea's crypto tax has been postponed twice before. Initially expected to come into effect earlier, the regulation was pushed back from 2025 to 2027 due to political disagreements, industry objections, and concerns about the technical readiness of exchanges. Recently, the ruling People's Power Party's proposal to completely abolish the tax has reignited the debate. The sector is also reacting negatively to proposed changes to anti-money laundering regulations.
While the tax debate continues, the South Korean crypto sector is also reacting negatively to proposed changes to anti-money laundering regulations. DAXA, which represents the 27 registered virtual asset service providers in the country, argues that the new rules are impractical.
According to the proposal, exchanges would be required to flag all overseas-linked transfers of 10 million won or more as suspicious transactions. According to DAXA, this requirement could increase the number of reported cases from approximately 63,000 last year to over 5.4 million. Industry representatives state that an increase of this scale would make compliance processes practically unmanageable.
The Financial Services Commission and the Financial Intelligence Unit proposed these changes on March 30. The public consultation period will continue until May 11. The final rules are expected to be announced in July.
