South Korean committee sends bill to scrap scheduled crypto tax to subcommittee
A National Assembly committee referred a proposal to remove South Korea's virtual-asset income tax provisions for further review on July 29. The tax remains scheduled to begin on January 1, 2027.
A South Korean bill seeking to repeal the country's planned tax on virtual-asset income was sent to a National Assembly subcommittee on July 29, moving it to further review without approving it.
The official legislative record identifies the proposal as Bill No. 2217609, a partial amendment to the Income Tax Act sponsored by lawmaker Song Eon-seok and 11 co-sponsors.
The bill was introduced on March 19 and referred to the Finance and Economic Planning Committee on March 20. On July 29, during the 437th National Assembly's third committee plenary meeting, lawmakers formally tabled the proposal, received an explanation and review report, held a general debate and referred it to a subcommittee.
The July 29 action was a referral for further review, not passage by the committee or the full National Assembly. The official record does not show the bill as approved or enacted.
What the scheduled tax would cover
Under current law, South Korea's virtual-asset income tax is scheduled to apply to income arising from transfers or lending on or after January 1, 2027. The start has already been delayed several times. The provisions remain enacted but do not apply until that date.
The National Tax Service's guidance classifies qualifying gains as separately taxed other income. The taxable base is generally calculated by subtracting acquisition costs and permitted expenses from proceeds, with an annual allowance of KRW 2.5 million.
The resulting taxable amount is subject to a 20% national income-tax rate. The combined rate is generally 22% after local income tax is included, ETNews reported.
Gains and losses can be netted within the applicable year. Residents with taxable virtual-asset income would generally report it between May 1 and May 31 of the following year. The guidance also provides a deemed acquisition-cost rule for assets held before the tax begins.
Bill No. 2217609 would delete the Income Tax Act provisions governing virtual-asset income, removing the planned tax rather than delaying it again.
In the proposal, the sponsors argue that taxing crypto gains would be inconsistent with South Korea's repeal of its planned financial-investment income tax. They also argue that crypto assets should not be treated in the same way as securities and that parts of the framework could create double-taxation concerns. Their acquisition-cost objection focuses especially on the practical difficulty of establishing costs for nonresident foreigners.
Those points are the sponsors' case for repeal, not settled findings. Their policy arguments do not change the tax rules unless the bill completes the legislative process and becomes law.
The bill now faces subcommittee review, where lawmakers can examine, amend, delay or reject it. Any revised text would still require further committee action and approval by the National Assembly before it could alter the current schedule.
For now, South Korea's crypto-income tax provisions remain scheduled to take effect on January 1, 2027, while lawmakers consider a bill that would remove them entirely.
