South Korean Tax Policy Association Proposes Two-Step Tax on Cryptocurrencies

South Korean tax experts have advised the Korean government to apply a low-level trading tax on cryptocurrency profits before subjecting citizens to a transfer income tax, according to a Business Korea report. The Korean government is expected to announce its tax reform plan in late 2020. 

The low-level trading tax was recommended because there is a lack of legal infrastructure to enact transfer taxation.

During a seminar on Feb. 21, members of the Korean Tax Policy Association advised the South Korean government to enact this two-step plan, arguing that taking a deliberative approach to implementing a cryptocurrency income tax will be most effective.

The Korea Blockchain Association agreed with the tax experts’ proposal, justifying their recommendation by noting that:

“Related laws are still absent and the taxation infrastructure is still insufficient to cover cryptocurrencies and, as such, some supplements need to be added on the expense calculation side.”

The Association also…