Governments across the globe started taxing crypto ever since they began seeing people garner profits by trading crypto. South Korea joined the list.
South Korea had time and again revealed its interest in crypto. The country is not only famous for its booming pop culture but also its inclination towards cryptocurrencies. Therefore, the government of the Asian country decided to levy a tax on trading a wide range of digital assets.
South Korea’s Tax On Crypto “Inevitable”
Back in February, the South Korean government affirmed that it would be taxing cryptocurrencies. The Ministry of Economy and Finance of the country revealed that all the profits made by trading cryptocurrencies would be subject to a 20% tax. However, the range of profits incurred while trading assets like Bitcoin [BTC] was limited to gains over 2.5 million won or $2,300. Those whose profits fall below these numbers are reportedly exempted from this tax.
While the taxing of crypto was scheduled to start off from 2022, the country’s finance minister, Hong Nam-ki went on to affirm the same, Reuters reported. Speaking at a news conference, the finance minister of the country, Hong Nam-ki was urged to delay this as the government needed a better rendering of the crypto-verse. But the finance minister asserted that taxing cryptocurrencies were “inevitable.” He added,
“It’s inevitable, we will need to impose taxes on gains from trading of virtual assets.”
The sudden emergence of cryptocurrencies has left the world in a frenzy. While some countries are preparing for the accommodation of these assets, a few others have outrightly started to ban cryptocurrencies.
Furthermore, governments have had a hard time categorizing cryptocurrencies. While some have put these assets under commodities a few others have labeled them securities. Hong Nam-ki, however, suggested that cryptocurrencies were “intangible assets” and not currencies. He even added that calling them currencies would be a “misunderstanding.”
Additionally, the country was seen taking impeccable precautions to dodge any possible scams against those using crypto. Earlier in March, the government announced that any crypto platforms that failed to have strong anti-money laundering processes in place would be subject to heavy fines.