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- Hong Nam-Ki has informed that the controversial crypto tax code will come into effect from January 1, 2022
- Kim Byung-ook asked as to whether the tax could be postponed until 2023
- the ruling party could pass the postponement bill only if they gather the votes
The Minister of Strategy and Finance from South Korea, Hong Nam-Ki expects that the controversial crypto tax code will come into effect from January 1, 2022. This was introduced amidst the uproar through the Democratic Party to put it off until 2023. A 20% tax on profits will be levied through crypto transactions which are more than 2.5 million Korean won or about $2100. As per the reports that appeared in the media, Democratic Party, which has a slim majority in South Korea’s National Assembly, decided to pass the bill postponing the crypto tax law by the end of October.
However, the party has to fight a battle to pass the bill amidst Hong’s opposition. Hong has had very good political powers since he was the former prime minister of South Korea. He was appointed foreign minister by the present President Moon Jae-in.
Crypto tax law is inevitable
This is the second time that the minister from the minority party People’s Power Party (PPP) has told the Democratic party despite the opposition that the tax would come into effect. National Assembly Representative from the Democratic Party, Kim Byung-ook has raised a question as to whether the tax could be postponed until 2023 to coincide with the Capital gains tax on stocks.
However, Hong stuck to his earlier plan and said no to postponing the tax law. He stated that the tax law had been drafted earlier and completed last year. In April he made it clear that crypto taxes had been inevitable.
It was not possible to collect taxes on virtual assets in the past so no taxation was carried out. But the foundation has now been laid and taxes will be levied starting next year.
On the other hand, Democratic Party representative Noh Woong-Rae said that the ruling party could pass the postponement bill only if they gather the votes. But it is a long battle of going against one of the most respected politicians of the country.
The Democratic Party had lost 18 out of one hundred eighty National Assembly seats in neighbourhood elections in June, displaying that they had fallen out of favour. Some horrific factors additionally exist among the celebration and Hong because the Democratic Party as soon as known as for Minister Hong’s resignation from office.
There are several reasons on which the Democratic Party is opposing the bill. They feel that there is inadequate infrastructure in place for the government to calculate and collect crypto taxes. As of now, the National Tax Service plans to rely on crypto exchanges to report users’ transaction data to calculate taxes.
The government has compelled the exchanges to get information security management system certification and a partnership with the local bank for a real name bank account for each user.
Andrew is a blockchain developer who developed his interest in cryptocurrencies while pursuing his post-graduation major in blockchain development. He is a keen observer of details and shares his passion for writing, along with coding. His backend knowledge about blockchain helps him give a unique perspective to his writing skills, and a reliable craft at explaining the concepts such as blockchain programming, languages and token minting. He also frequently shares technical details and performance indicators of ICOs and IDOs.
