South Korea Proposes Fourth Crypto Tax Delay, Moving Start to 2029

SEOUL, 5 November 2026 — South Korea's government announced on Thursday that it would seek to postpone taxation of cryptocurrency income by two more years, from January 2027 to 2029, and consult Parliament on allowing investment losses to be carried forward for three years. The proposal is a formal change in government policy, but it is not yet an enacted amendment to the tax law.

Finance Minister Lee Hyoung-il announced the plan at a briefing at the Government Complex Seoul, according to firsthand reports by YTN and The Korea Times. He cited unresolved access to records of trades on overseas exchanges, changes expected under broader digital-asset legislation and concerns about treating domestic and foreign transactions consistently. South Korea expects to begin exchanging cryptocurrency transaction information with the United States in 2029, he said.

Under the law currently scheduled to take effect on 1 January 2027, annual net income from transferring or lending virtual assets above 2.5 million won would be taxed at a combined 22% rate, including local income tax. The regime was legislated in 2020 for a planned 2022 launch and has already been postponed three times. A further delay requires legislative action; investors should not assume the existing statutory date has already been repealed.

The government also wants to permit a three-year loss carryforward. This would allow eligible losses to offset later taxable gains, a feature not included in the present virtual-asset income-tax framework. Details of the eligible losses, recordkeeping and overseas reporting remain to be developed. Officials said a public-private working group would prepare improvements by the first half of 2027, seek legislative amendments in the 2027 regular session and publish detailed tax guidance in the first half of 2028.

The announcement follows a ruling-party request for postponement a day earlier and reverses the government's previous position that the tax should begin in January. Industry representatives argue that reporting systems and overseas acquisition-cost records are not yet reliable enough. Opponents of another delay say repeated reversals weaken predictability and may create unequal treatment compared with taxpayers on other forms of income. The Korea Times reported both perspectives; neither establishes a motive for the government's decision.

This is a substantive follow-up to TFNOS's 28 October report, which documented that talks between the governing party and finance officials had ended without a decision: https://tfnos.org/article/south-korea-s-ruling-party-and-government-leave-january-crypto-tax-decision-unresolved-12508a642834 . The new fact is that the finance minister has now publicly committed the government to seeking a two-year postponement. The previous report's description of the decision as unresolved was accurate for 28 October; it should not be presented as the current position.

The next accountability test is whether lawmakers pass the necessary amendment, what safeguards apply to overseas transactions, and whether the proposed loss-carryforward rules treat investors consistently. Until Parliament acts, the announced 2029 date remains a government legislative proposal rather than a completed statutory change.

Sources: YTN, Korean-language reporting of the finance minister's 5 November 2026 briefing; The Korea Times, independently reported 5 November briefing and policy reactions.