South Korean lawmakers are on the verge of agreeing to postpone the cryptocurrency tax’s introduction.
Representatives of the National Assembly’s Tax Subcommittee reached a bipartisan agreement to postpone implementation of the country’s new tax system by one year. The co will be delayed for some time until more research has been done on how consumers can adopt it.
This postponement was requested by Democratic legislators who were concerned about the National Revenue Service’s (NRS) information collection methods if this new tax measure was implemented sooner.
Now.. If MPs vote in favour of the amendment at their meeting on December 2, the tax will not take effect until January 1, 2023, rather than the beginning of 2022 as intended.
However, one approach imposed a large tax on long-term cryptocurrency investors who stored their money in private wallets before implementing the tax legislation. They would essentially be taxed on the whole value of these assets, not only on the profits generated by them.
Kim Young-jin, head of the Tax Subcommittee, also brought attention to the issue of residents being required to pay taxes on cryptocurrencies, even though the government has not yet developed an official definition of cryptocurrency or virtual assets.
There is an inconsistency in our taxation system. There is no clear foundation for defining cryptocurrencies legally in our system… yet only in Korea do taxes take precedent over-regulation.he said.
South Korea is one of the most technologically advanced countries in Asia, and the world’s first cryptocurrency exchange takes place here. Over 10% of global transactions occur in South Korea, where cryptocurrency like Bitcoin is traded.
Many are concerned about how much South Korea will tax digital currencies and digital assets considering their limited understanding of these technologies. The new taxes might have an adverse effect on the country’s ambitious plans for blockchain technology innovation and adoption.
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