South Korea Confirms 22% Crypto Tax Starting January 2027

South Korea's Deputy Prime Minister Koo Yun-cheol confirmed the country's crypto tax will take effect on January 1, 2027. The tax rate is 22% on annual gains above KRW 2.5 million, roughly $1,740.

Speaking before the National Assembly's Finance and Economy Planning Committee on July 29, Koo said, "We are pushing forward with the plan to tax cryptocurrency starting next year as scheduled." The statement ended months of speculation that Seoul might delay the measure for a fourth time.

Lawmakers first approved the tax in 2020, with an original start date of January 2022. They postponed it to 2025, then again to 2027 through a December 2024 amendment. Those repeated deferrals helped sustain South Korea's high retail crypto trading volumes.

Under the Income Tax Act, gains from transferring or lending virtual assets above the KRW 2.5 million threshold are treated as "other income." A 20% national rate kicks in above that threshold, climbing to 22% once the local income tax surcharge is added. Investors earning less than KRW 2.5 million pay nothing. They will file their first returns around May 2028, covering income earned throughout 2027.

Kim Sang-hoon of the opposition People Power Party warned the National Assembly that barring investors from offsetting losses against future gains could drive activity to overseas exchanges or peer-to-peer channels. That would directly hurt volumes on domestic exchanges like Upbit, Bithumb, Coinone, and Korbit.

Kim also argued the tax should wait until the OECD's Crypto-Asset Reporting Framework, which enables cross-border tax data sharing, is fully operational. A separate opposition bill introduced in March 2026 would abolish the crypto tax provisions entirely by removing crypto income from the Income Tax Act. The measure was referred to a subcommittee on July 29, the same day Koo reaffirmed the launch.