Seoul's finance minister proposes moving the crypto tax start to 2029 to wait for US data sharing, along with a three-year loss carry-forward

South Korea's government has formally backed another delay to its crypto tax. At a briefing in Seoul on November 5, Deputy Prime Minister and Minister of Economy and Finance Lee Hyoung-il said the government will seek to move the start from January 1, 2027 to 2029, Money Today and Blockhead report. It would be the fourth postponement of a tax first legislated in 2020. The ruling Democratic Party had asked for the delay earlier in the week.

The government gave two reasons. Taxing crypto before South Korea begins exchanging crypto transaction data with the United States in 2029 could put the domestic market at a disadvantage, and the planned Digital Asset Basic Act is expected to change how assets and service providers are defined. The tax is 22%, made up of 20% national income tax and 2% local tax, on yearly gains above 2.5 million won.

Investors would also get relief they lack today. Crypto income is classed as other income, so losses cannot be carried forward; the plan would let them be deducted from gains for up to three years. A public-private working group will look at detailed tax rules and filing.

The delay is a proposal, not law. It needs an amendment to the Income Tax Act passed by the National Assembly.