More than nine out of 10 digital asset industry officials and experts in South Korea said a planned tax on cryptocurrency gains should be postponed, as the government moves to begin levying the tax next year. They said taxation should be pushed back to after 2029, when the United States joins the Crypto-Asset Reporting Framework (CARF), warning that imposing taxes without adequate preparation could trigger an exodus of funds from domestic exchanges.
The findings come from an urgent survey conducted by The Seoul Economic Daily on the 18th of 30 chief executives and academic experts across the digital asset sector, including major exchanges such as Dunamu, the operator of Upbit, and Bithumb, as well as custody and blockchain infrastructure firms.
In the survey, 93.4%, or 28 respondents, supported delaying the crypto tax next year. "Strongly support" was the most common answer at 70%, followed by "support" at 23.4%. Only one respondent, or 3.3%, opposed a delay.
The 28 respondents who backed a delay said the start of taxation should be pushed back by at least two years. The largest share, 39.3%, chose 2029, while 35.7% picked 2030. Another 21.4% said 2031 or later, meaning an overwhelming 96.4% said the tax should take effect in 2029 or after.
The industry's biggest concern is fairness. With cryptocurrency moving in complex patterns across domestic and overseas exchanges and private wallets, respondents questioned whether tax authorities can track every transaction accurately and apply the same standard to all investors. Only two respondents, or 6.6%, said the National Tax Service could accurately track and tax transactions on overseas exchanges and private wallets. Nearly half, 46.7%, described the agency's information-gathering and transaction-tracking capability as "very insufficient," while another 40% chose "insufficient."
Investors who would owe the tax are equally unprepared. Individuals must gather transaction records scattered across domestic and overseas exchanges and private wallets, then calculate acquisition prices and gains or losses on their own. In the survey, 90% of respondents said investors are poorly prepared to file, and half said they are "not prepared at all."
The industry expects that pushing ahead with taxation under such conditions would drive domestic investors to overseas exchanges en masse. Of the respondents, 86.7% forecast that trading volume at major domestic exchanges would fall after the tax takes effect. A decline of 30% or more was cited by 56.7%, a drop of 10% to 30% by 26.7% and a drop of up to 10% by 3.3%. Another 10% said there would be no impact. According to the Financial Supervisory Service, won-based crypto exchanges handled an average of 3.1 trillion won ($2.1 billion) in daily trading in the first half of this year, or 558 trillion won over the six months by a simple calculation. The head of one domestic digital asset firm, identified as A, said an exodus to overseas exchanges is all but certain.
Disputes over the fairness of the tax burden are also intensifying. Under the current rules, only 2.5 million won of annual income from crypto investment would be deducted, with a 22% rate applied to the remainder. That is one-twentieth of the 50 million won basic deduction once proposed for domestic listed stocks under the financial investment income tax. Of the respondents, 70% argued the basic deduction for cryptocurrency should be raised to at least 50 million won. A tax expert identified as Professor B said any grace period must specify the agency responsible for each task, completion deadlines and verification standards, stressing that simply delaying the start of taxation is not enough.
Respondents also faulted the government for failing to put proper rules in place despite repeated postponements. The crypto tax was originally set to take effect in 2022 but has been delayed three times and is now scheduled to begin next January. Professor C, who specializes in digital assets, said there must be reflection and accountability for the fact that existing policy has not improved at all through several rounds of delay.
As calls for a delay grow louder, the government is moving to gather industry views. Kwon Dae-young, first vice minister of the Ministry of Finance and Economy, and Yoo Young-joon, director general for digital finance policy at the Financial Services Commission, will meet the heads of the five largest crypto exchanges on the 20th to hear about preparations for the tax and requests for regulatory changes.