2021-11-09 16:00:29
Main S Korea’s Presidential Candidates Oppose Crypto Tax – But Gov’t Won’t Budge. The long-running will-they-won’t-they saga of the South Korean government’s crypto tax plans has taken a fresh turn – after both of the leading candidates to become the next President in March 2022 said they were in favor of delaying or amending the tax.
As previously reported, the issue is thorny: The tax was already been voted into law and is slated to come into force on January 1, 2022. South Korea goes to the polls on March 9, where one of Lee Jae-myung, the nominee of the Democratic Party, and the newly confirmed main opposition candidate Yoon Seok-yeol will almost certainly be elected.
The new law requires crypto trading profits over an annual total of USD 2,100 to be taxed at 20% under revised capital gains tax provisions. The National Assembly has already signed off on the law, although it was bundled with other legal amendments at the time. However, it has since proved extremely unpopular with younger Koreans in the “2030 generation” – city-dwellers aged 20-39, who have sunk much of their savings into crypto investments in the past year or so. Petitions aimed at changing the government’s mind on the issue have thus far fallen on deaf ears.
Last week, media reports noted that the major parties were becoming increasingly “conscious of the voting behavior” of the 2030s, and quoted political analysts as opining that “the government will eventually raise the white flag” on crypto tax.
This appears not to be the case so far: On November 8, the Minister of Finance and incumbent Deputy Prime Minister Hong Nam-ki once again dug his heels in on the issue, telling a budget-related special committee at the National Assembly that crypto profits “should be taxed as per the agreed schedule,” EDaily reported.
Newsis reported that the grilling appears to have continued earlier today, when the committee convened again, and Hong was again challenged on the issue, with voices calling for a one-year deferral growing increasingly loud.
However, the same media outlet noted that with all sides now calling for a one-year deferral, the Deputy Prime Minister is now on increasingly shaky ground.
The Democratic Party and Lee appear to believe that the issue is not worth losing an election over. Maeil Kyungjae reported that a behind-closed-doors meeting saw the leadership of the ruling party effectively decide to postpone the crypto tax until 2023, in line with previous comments on the matter from the Democratic nominee.
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