South Korean Opposition Party Proposes Abolishing Crypto Taxation

South Korean lawmakers are proposing a bill to abolish the planned income tax on crypto assets, citing concerns about double taxation and inconsistencies with the current tax system.

The People Power Party (PPP) has introduced an amendment to the Income Tax Act, which is scheduled to take effect in 2027. The proposed change would remove all provisions governing the taxation of digital assets from the act.

According to the report, PPP's floor leader, Song Eun-seok, introduced the legislation on March 19. He mentioned recent joint guidance by the US Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC), which classified most digital assets as commodities rather than securities.

The bill argues that treating digital assets under the same tax system as securities is inappropriate, given their classification in Korea as commodities subject to value-added tax. It also raises concerns about double taxation, considering that financial investment income tax has been abolished to promote capital market development and protect investors.