S. Korea considering imposing 20% tax on cryptocurrencies

Andrew Cummings
January 21, 2020

The South Korean government is considering applying a tax rate of 20 percent to income derived from cryptocurrencies by regarding it as not transfer income but miscellaneous income, which includes lottery payouts, lecture fees, royalties, and the like. When viewed as capital gains, the bureau had to first be given trading data from crypto exchanges in order to ascertain the tax obligations and calculate the baseline for the payments.

A transparent, uncomplicated plan for cryptocurrency taxation is required in South Korea.

Officials from the government and the industry met today to discuss the reorganization of the tax scheme in regard to cryptocurrency and others.

As per Pulsenews, the department of income tax in the Finance Ministry in South Korea is considering imposing a 20% income tax on profits from transactions on crypto exchanges, including gifts made in crypto.

The tax amount comes from 20% as income tax, and 2% resident tax.

But finalizing the current proposal by the Korean government is significant since it will make the taxation compulsory, posing a threat to the local crypto market, which is already going through a regular monthly average decrease in trading volume.

However, new information came out today from the Asian country that could lead to the opposite. At the same time, countries like Switzerland and Germany become a haven for as they openly invite investors with the promise of lower taxes.

Investors lament a number of confounding factors, such as the ongoing housing bubble, that they feel are conspiring against individuals, making them worry about their country's future. Crypto firms had to list their token on platforms outside South Korea, blaming declining trading activities. Also, the International Tax Division analyzed the 80 billion won tax imposed on cryptocurrency exchange Bithumb by the National Tax Services.

South Korean Investors with a large amount of capital in cryptocurrency are expected to flee before the implementation of the taxes.

Korea isn't the only nation looking to place taxes on crypto.

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