South Korea’s finance ministry has publicly confirmed for the first time that the country’s long-delayed tax on cryptocurrency gains will proceed as scheduled in January 2027, ending years of uncertainty for the country’s estimated 13.26 million crypto investors.
The confirmation came from Moon Kyung-ho, director of the ministry’s income tax division, who made the announcement at an emergency parliamentary forum on virtual asset taxation held at the National Assembly Members’ Office Building in Seoul on Thursday. “We will proceed with virtual asset taxation as scheduled in January next year,” Moon said, marking what appears to be the ministry’s first explicit public commitment to the timeline after two previous postponements.
What the tax means for investors
Under South Korea’s existing Income Tax Act, profits made through the transfer or lending of virtual assets will be classified as “other income” beginning January 1, 2027. Investors who earn more than 2.5 million Korean won, approximately $1,800 annually from crypto-related activities will be subject to a 22% tax, comprising a 20% base income tax and a 2% local surcharge. The threshold and rate structure apply broadly across the country’s large retail crypto investor base.
The tax has been delayed twice before, with the start date shifted from 2025 to 2026 and then again to 2027, amid sustained industry pushback, political disagreement, and concerns about whether exchanges were technically ready to implement the required reporting systems. The ruling People Power Party had even put forward a bill to scrap the tax entirely before its 2027 rollout, making Thursday’s ministerial confirmation a meaningful shift in the official position.
Exchanges being brought into the process
Moon confirmed that the National Tax Service is currently in the process of finalising implementation guidance for the new framework. The agency has already held a series of working-level meetings with South Korea’s five major crypto exchanges, Dunamu (Upbit), Bithumb, Coinone, Korbit, and Gopax, to prepare a draft regulatory notice. That notice will be submitted for legislative review at some point during 2026. Speaking to reporters following the forum, Moon clarified that while a notice is being prepared, it would not arrive imminently, walking back an earlier suggestion that guidance would be published soon.
Industry resistance on AML rules adds further pressure
The tax confirmation arrives alongside a separate and equally contentious regulatory debate. Proposed amendments to South Korea’s anti-money laundering (AML) framework have drawn significant criticism from the country’s crypto sector. DAXA, an industry association representing 27 registered virtual asset service providers, warned that a proposed rule requiring exchanges to flag all overseas-linked transfers of 10 million won or more as suspicious activity would increase reportable cases by as much as 85 times, from approximately 63,000 cases last year to over 5.4 million, rendering meaningful compliance practically impossible.
The proposed AML amendments were put forward by the Financial Services Commission and Financial Intelligence Unit on March 30, with a public comment period running through May 11 and final rules expected to be issued in July.
Taken together, the confirmed tax timeline and the AML overhaul signal that South Korea is moving decisively toward a more formalised regulatory posture on crypto, one that will place significant new obligations on both investors and the platforms that serve them. For the country’s millions of crypto holders, January 2027 is now a firm date on the calendar.
