The Ministry Of Finance of South Korea recently made an announcement saying that the current tax laws in the country do not currently include profit taxation for crypto trading. An official announcement was made in regards to this.
Right now, the Ministry of Finance is under the control of the Liberal Korean Party, which is known for supporting regulations that are relaxed for digital currencies and even crypto trading. The party is known as proponents of blockchain development and technology.
The statement was simple and it just stated that crypto traders in the country are not obligated to pay some taxes based on crypto trading income. The current tax law does not see trading gains as being taxable events. This is something that makes the entire Korean crypto community appreciates.
Even if current laws are favorable, there are many that expect this to change in 2020 or the following years. Officials know that there are shortcomings in the tax law. Sources think that the Korean Ministry of Finance is right now working on new amendments that can cover the current loophole. Crypto taxation might be included soon.
Minister of Finance Kyoil Choi said:
“The cryptocurrency industry should be incorporated into the institutional sphere for the sake of transparent transactions.”
The Minister is interested in transaction transparency. This news came after different Korean exchanges delisted many privacy coins, like Monero and Zcash.
Since we are talking about privacy coins, it is thought that they are being used to launder money. This is what the authorities think. Most think that privacy coins are not appreciated by the government since it allows the crypto users to maintain privacy. Other people think that cryptocurrencies need transparency so they can be adopted by the masses.
Besides this news, something else in the country caught the attention of the community. It was revealed that Bithumb (Korean-based company) owns $70 million in taxes to Korean NTS.
At the moment, the Korean crypto tax problem is unresolved. Crypto transaction taxes should not exist when looking at the law. However, Bithumb will end up having to pay $70 million if laws change.
You might also be interested in knowing that Ukraine is planning to introduce a new bill that will tax the crypto gains. Many other countries are meant to follow on the footsteps of Ukraine.
All this news hints at the fact that 2020 will be a year when many crypto hubs are going to be focused on taxing crypto trading, as opposed to regulating. The crypto sector right now is faced with struggles. Such taxation laws might make things different.
Korea does not tax crypto gains right now. Do you think this will change in the future?