After months of speculations, the South Korean government has finally decided to impose taxes on cryptocurrency gains in the country, albeit with a few terms and conditions.
According to local news outlet Pulse News Korea, the Ministry of Economy and Finance revealed that it would be imposing a certain percentage on crypto gains starting from next year.
Starting from January 2022, South Korean crypto investors and traders who make a crypto profit of at least 2.5 million won (2,230 USD) will be billed 20 percent of their gains. However, crypto miners will be getting tax deductions for expenses related to their mining activities. The Ministry revealed mining costs would be considered business expenses and would otherwise be considered in their tax calculations.
After the implementation of its new policy, South Korea will be following in the footsteps of Germany and the UK who have imposed unusual tax laws on cryptocurrency gains in the past.
The news of South Korea’s crypto tax is coming after rumors that the US President, Joe Biden, might impose a similar bill on cryptocurrency gains as well. The news caused Bitcoin and other cryptocurrencies to dip and stumble on their inspired bullish run.
South Koreans’ Reaction to Taxation Laws
How are South Koreans taking it?
While the reactions to Biden’s suggested crypto plans were not all too positive, South Koreans’ overall reaction to the development has ranged from outright rejection to mixed acceptance.
Within the past three months, Korean cryptocurrency advocates have sent in three different petitions to the Blue House, the official residence of South Korea President, Moon Jae-in. Each petition has gathered tens of thousands of signatures. The third petition, which gathered almost fifty thousand signatures and was only just sent in two weeks ago, appears to have won no love in the Blue House, especially considering the latest announcement.
While there have been obvious clamors to reject the new tax bill, a poll conducted by a popular South Korean research organization, Realmeter, revealed more than 53% of South Koreans might be in favor of the new regulation after all.
Whatever the case, South Korea’s new bill now looks set to hold, as the country continues its deliberate efforts to create a proper cryptocurrency structure for the booming industry in the country.
