TL;DR:
South Korea’s government and major political parties agreed to postpone the 22% digital asset capital gains tax for two years, moving the effective date from January 2027 to January 2029.
The revised proposal incorporates a mechanism that allows investors to carry forward accumulated losses over a three-year period against future taxable gains.
The formal postponement depends on legislative approval of the Income Tax Act amendment during the National Assembly’s year-end plenary session.
The South Korean government and leaders of major parliamentary parties reached a preliminary agreement on Thursday, November 5, to postpone the implementation of the crypto tax for an additional two years, moving its projected rollout from January 2027 to January 2029.
Just in: South Korea moves to delay crypto taxation by another 2 years. Big moment for the Korean crypto community. https://t.co/mRYZxEifdt
— Cedric (@eth_cedric) November 5, 2026
This marks the fourth deferral of the virtual asset tax regime since it was first introduced legislatively in 2020.
According to market reports, both the ruling and opposition parties agreed on the need to delay the fiscal framework to adapt technical collection systems before requiring user reporting. Current legislation sets a 20% nominal rate on net gains exceeding 2.5 million won annually (approximately 1,700 USD), supplemented by a 2% local income tax, bringing the total tax burden to 22%.
The proposal includes a three-year loss carryforward provision designed to offset previous negative fiscal periods prior to the final calculation of the tax base.
Regulatory Motives and Tax Information Exchange
Legislative reports note that international coordination serves as one of the decisive factors behind the delay consensus . Official documentation tied to the OECD’s Crypto-Asset Reporting Framework (CARF) indicates that multilateral data-sharing channels for crypto transactions will not operate uniformly with the United States until 2029.
National Assembly representatives argued that enforcing the tax without consolidated mechanisms covering foreign exchanges would create a competitive disadvantage for local platforms.
An industry source added that South Korean authorities continue to work on the second phase of their comprehensive digital asset regulatory framework. This pending body of legislation seeks to formally regulate exchanges and stablecoin issuers, as well as clarify pre-implementation audit obligations before tax enforcement begins.
In parallel, financial regulators in Seoul continue deliberations regarding exchange custody requirements, evaluating a rule that could require storing up to 99% of customer funds in cold wallets.
According to operational data, local platforms currently operate with varying levels of cold storage: Upbit holds over 99% of client assets in cold storage, Bithumb reports around 94%, and Coinone roughly 85%. Industry operators expressed concern that frequent asset transfers between hot and cold wallets could slow daily investor withdrawals.
The Financial Services Commission has not yet officially established the final percentage for the storage requirement.
The draft bill amending the Income Tax Act has been referred to the tax subcommittee for technical review. The final vote on the bill during the South Korean National Assembly’s plenary session is scheduled to take place before the end of December.
