A national petition demanding the repeal of cryptocurrency taxation has advanced to the National Assembly's agenda for deliberation.
According to the financial industry on the 21st, the "Petition on the Repeal of Virtual Asset Taxation" posted on the National Assembly's electronic petition board secured more than 50,000 signatures within eight days, meeting the requirement for referral to a standing committee. The petition will be sent to the Strategy and Finance Committee, which oversees the Ministry of Economy and Finance and the National Tax Service, for review before a decision is made on whether to bring it to a plenary session.
The issue investors raise most strongly is the lack of tax parity with the stock market. The petitioner argued, "While the financial investment income tax on stocks is being abolished and tax burdens eased, applying separate taxation only to cryptocurrency is unreasonable," adding, "The current system requires not mere supplementation but a full review."
Currently, domestic stocks are not subject to capital gains tax for ordinary investors who are not major shareholders. In contrast, cryptocurrency profits exceeding 2.5 million won annually will be subject to a 22 percent tax rate, including local taxes. Investors are also pushing back against the structure that does not allow loss carryforward deductions, calling it an excessive burden given the high volatility of the asset.
Experts agree that the taxation framework itself has not yet been sufficiently established. They point out that the United States is set to join the global Crypto-Asset Reporting Framework (CARF) in 2029, meaning that until then, tracking transactions on overseas exchanges and through personal wallets remains limited. Critics also note that taxation standards for new types of income such as staking, airdrops, and decentralized finance (DeFi) remain unclear.
"Even among CARF member countries, including the United States, there is no guarantee that information sharing will actually proceed smoothly," said Oh Moon-sung, professor of tax accounting at Hanyang Women's University and chairman of the Korean Tax Policy Association. "Ultimately, criticism is bound to arise that the government is only catching investors it can identify through domestic exchanges — the so-called 'fish in a fishbowl.'" He added, "Major investors will ultimately find ways to escape through overseas exchanges or personal wallets. The current cryptocurrency market has many investors who have suffered losses, so the actual tax revenue effect would not be significant either." ▷See this newspaper's May 15 edition, Page 9.
