South Korea’s main opposition People Power Party has proposed eliminating the planned 2027 tax on digital asset income, raising worries about double taxation and policy inconsistencies.
According to a local news outlet, Floor Leader Song Eon-seok’s proposal aims to eliminate the present income tax provisions on digital assets from the tax code, saying that the current tax policy results in double taxing and inconsistent treatment with other financial asset taxes.
As per the present legislation, starting on January 1, 2027, digital assets will be subject to an income tax rate of 20%, and it will go up to 22% plus local taxes that exceed 2.5 million Korean won, which is about $1,665. While the country had already postponed the implementation of this tax legislation three times, with the original 2022 target date moved back due to industry and investor reaction.
Tax Concerns and Regulatory Challenges
The proposed amendment raised concerns about the U.S. regulatory regulation of digital assets, arguing that it is inappropriate for the SEC to classify digital assets as commodities rather than securities and tax them under the same system as securities.
Eon-seok went and said that if the income tax is implemented, considerable practical and administrative challenges, such as determining acquisition expenses for non-resident foreigners, will arise, thereby limiting the system’s efficacy.
In response, the Democratic Party of Korea stated its position regarding the People Power Party’s push to abolish taxation on digital assets, saying, “Since a bill has been introduced, we will discuss it.”
As of June 20, 2025, the Financial Services Commission reports that the overall capitalization of South Korea’s crypto market was 95.1 trillion won, or roughly $63.4 billion. This number illustrates the expanding scope and the significance of digital assets in South Korea.
