South Korea Confirms 22% Crypto Tax From 2027

South Korea plans to bring virtual-asset profits into its capital-gains tax regime, targeting annual crypto gains above 2.5 million won, or about $1,740. Gains exceeding the allowance would face a combined 22% levy, comprising a 20% national tax and a 2% local tax. The measure matters for retail investors and the competitiveness of South Korea’s large crypto market, while remaining a point of contention in the National Assembly.

The tax is scheduled to take effect on Jan. 1, 2027, unless lawmakers repeal it or approve another delay as the political battle moves through parliament. The debate comes as trading volume across South Korea’s five largest crypto exchanges has fallen 55% over the past six months, heightening concerns that the levy could further weaken domestic activity. Without new legislation, the 2.5 million-won threshold and 22% rate will take effect as planned.

South Korea had planned to impose a 20% income tax from Jan. 1, 2027, on annual virtual-asset gains exceeding 2.5 million won. A 2% local tax would bring the effective rate to 22%. The measure has been postponed several times, amid persistent disputes over fairness, the deduction threshold and authorities' ability to obtain trading data.

The main opposition People Power Party, or PPP, recently proposed an amendment to the Income Tax Act that would scrap the crypto gains tax scheduled for 2027 rather than delay it again. A related petition to abolish the tax has reached the 50,000-signature threshold and will be reviewed by South Korea's National Assembly. The proposal could also create a policy conflict with the National Tax Service, which has already invested in building a taxation system.