South Korean government may impose 20% tax on crypto income. Ministry of Economy and Finance had ordered its income office to review cryptocurrency taxation, according to English-language news outlet The Korea Times on Jan. 20.
There are speculations that the government may categorize profit received from cryptocurrency trading as “other income” and not capital gains. The other income category also includes gains made from lectures, lottery purchases and prizes.
News of the proposed rate follows reports earlier this month that South Korea is drafting a tax regime for profits made from trading cryptocurrencies.
A clear outline for cryptocurrency taxation is much needed in South Korea. As a reminder, back in December, major local cryptocurrency exchange Bithumb announced that it was considering administrative litigation over an $68.9 million tax bill that it believes has no legal basis. More recent reports indicate that the firm decided to follow through and take tax authorities to court.