South Korea Cracks Down on Crypto Gains with 2027 Tax Deadline
South Korea's government has confirmed that it will begin enforcing a tax on digital asset income from January 1, 2027, after three delays. The tax was initially set to come into force in January 2022 but was pushed back twice more.
The tax will be levied at a rate of 20% on annual gains exceeding 2.5 million Korean won, which is roughly $1,800 at current exchange rates. This threshold is lower than many other jurisdictions that tax crypto and contrasts with the country's stock trading regime, where higher exemptions shield most retail investors.
Market participants fear that the tax will lead to a sharp initial drop in trading volumes, particularly among high-frequency traders and liquidity providers who are already modeling for a taxed market. The Korean government has hinted at potential tweaks after implementation, but this has not calmed nerves.