South Korea's Crypto Tax Delay Petition Surpasses 50,000 Signatures, Initiating Legislative Review

More than 50,000 South Korean crypto investors have signed a petition urging the government to postpone the implementation of a 22% tax on virtual asset gains by two years. This petition, titled "Petition for a Two-Year Deferral of Coin Taxation," reached the required threshold to compel the National Assembly to formally review the proposal. The signatures were collected between late August and September 13-14, 2026, and the petition will now be assessed by the Strategy and Finance Committee.

The proposed tax is set to take effect on January 1, 2027, and includes a 20% national levy along with a 2% local tax, applicable to annual virtual asset gains exceeding 2.5 million won (approximately $1,650 to $1,800). Petitioners argue that the necessary infrastructure for effective tax enforcement is lacking, citing inadequate decentralized transaction tracking systems and insufficient investor protections. They contend that taxing untraceable transactions could hinder compliant investors while failing to capture revenue from those operating outside centralized exchanges.

This is the second petition to surpass the 50,000-signature mark in 2026, following a previous effort in May that called for the outright repeal of the virtual asset tax. Despite these petitions, the nominee for deputy prime minister has indicated that the government plans to enforce the tax as scheduled, emphasizing the principle that income should be taxed where it is earned. Supporters of the current petition warn that the tax could lead to market contraction and capital flight, as investors may relocate assets to jurisdictions with more favorable tax conditions.

© 2026 KLEA News. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Source: KLEA News