The planning and finance committee of South Korea’s national assembly reportedly suggested delaying the commencement of the cryptocurrency income tax rule to January 2022. South Korea originally planned to implement the mentioned rule by October 2021.
According to a report published by South Korean media the DONG-A ILBO, the assembly is pushing to delay the rule as crypto exchanges operating in the country require more time to build an effective taxation infrastructure.
The Ministry of Economy and Finance introduced amendments in tax rules earlier this year to charge South Korean residents a 20% income tax on cryptocurrency gains worth more than 2.5 million won, or around $2000.
The report states that the South Korean Congress is worried about the fact that the crypto industry is not ready to implement such changes in a short time. In addition to the crypto income tax rule, exchanges need to enforce the ‘Special Financial Information Act’ by next year.
Information Act
According to the report, crypto exchanges are running out of time in Korea. Under the “Specific Financial Information Act”, the exchanges must complete a reporting system by September 2021, to complete the KYC of clients in order to show verified names of deposit and withdrawal accounts. The report cites that some investors are unhappy with recent initiatives by the Government related to crypto regulations. “We need to listen fully to the infrastructure and readiness of the (industry). I feel that the young people can react with greatness, and it is good to implement it quickly, but it is important to calmly take on the system while securing a considerable degree of sympathy,” the Democratic Party’s employment wing member said in a statement.
Finance Magnates earlier reported a decision by South Korea’s Financial Services Commission (FSC) to ban anonymous digital currencies that possess a high-risk of money laundering. The country also launched a crackdown on several crypto exchanges in the past.
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