South Korea Prepares Amendments to Income Tax Act for Crypto Industry

The South Korean Ministry of Economy and Finance is preparing amendments for the existing Income Tax Act. The amendment will affect the taxation of profits from cryptocurrency trading and crypto mining projects. The ministry also reports on imposing tax for income from ICOs. At the moment, this statement of the Ministry seems to be puzzling, since ICOs are still banned in the country.

The Ministry says the proposed amendment will be ready by July and will be submitted to parliament in September. According to the plans of the Ministry, the amendment to the Act will be developed in accordance with the current securities tax law. It is likely that crypto-crypto transactions will be tax exempt. Media sources previously reported that Seoul has already introduced a new cryptocurrency law that contains provisos regarding exchanges. Under the new terms, crypto exchanges will provide data to the tax authorities as part of new regulatory measures that will enter into force in the spring of 2021.

According to the official from the Korea Institute of Local Finance, people who want to evade taxes will do this through OTC. Experts say that the government needs to deal with the issue of imposition of tax for profits from crypto business until an effective plan is developed: the process can take from three to four years.

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