South Korea’s Ministry of Strategy and Finance will reportedly release a taxation framework for cryptocurrencies by the end of June, local news outlet Fuji News Network (FNN) reported March 25.
A spokesperson for the Ministry of Strategy and Finance said that although they “do not have a specific time frame,” they are “thinking about announcing a virtual money tax in the first half of the year,” and FNN adds that any taxation would only start next year.
The announcement of the future tax plan came after the Finance Ministers’ meeting of the G20 that took place earlier this month from March 19-20.
In December of last year, South Korea’s Deputy Prime Minister and Minister of Strategy and Finance said that the country was looking into taxation methods for the local Bitcoin (BTC) market. More recently, in January, South Korea announced that cryptocurrency exchanges will be taxed in line with the existing tax policy, a 22 percent corporate tax and a 2.2 percent local income tax.
The South Korean government’s crypto tax task force has proposed a “transfer income tax that levies taxes on profits” made from crypto sales, FNN writes, adding that “If income from virtual currency transactions is considered temporary and irregular, other income taxes may be imposed.”
South Korea’s Ministry of Taxation has looked internationally for examples in crypto taxation, sending employees to the US, Japan, Germany, and the UK for surveys of their varying crypto tax frameworks. The surveys found that in most cases, taxation is applied “based on the principle that there is a tax on income,” as opposed to non-income taxes, according to FNN.
According to FNN, the Korean government will also be setting up “full-scale virtual currency regulation” after local elections on June 13. FNN adds that the Ministry of Finance and Economics will hold a virtual currency international conference held in Seoul on June 14 for G20 members, as well as the “second working session of the G20 international financial system” on June 15.