South Korea is preparing to implement cryptocurrency taxation from January 1, 2027, signaling that officials do not currently plan to postpone the policy for a fourth time.

The proposed rules would apply a tax of up to 22% on annual cryptocurrency gains above 2.5 million won, approximately $1,740.

The crypto tax was initially scheduled to take effect in January 2022 before being pushed back to 2025. In December 2024, another amendment delayed the rollout by two more years, setting the new start date for 2027.

Deputy Prime Minister Koo Yun-cheol reiterated the government’s position during a July 29 hearing of the National Assembly’s Finance and Economy Planning Committee, saying the country would move ahead with the planned cryptocurrency tax next year.

Under the proposed structure, income from crypto transfers and lending activities would be classified as separate “other income.” Investors would receive an annual exemption of 2.5 million won, while profits exceeding that amount would be taxed at 20% federally, or 22% when local income tax is included, according to the National Tax Service.

The plan has drawn criticism from opposition lawmakers. Kim Sang-hoon of the People Power Party argued that the absence of loss carryforward rules could discourage domestic trading and push investors toward overseas centralized exchanges, decentralized platforms, and peer-to-peer markets.

Kim also called for delaying the tax until the OECD’s Crypto-Asset Reporting Framework is fully operational, arguing that stronger international reporting standards are needed first.

The final outcome remains uncertain. A bill introduced in March seeks to eliminate the crypto tax altogether by removing digital asset income from the Income Tax Act.

The proposal was reviewed by the committee on July 29 and sent to a subcommittee for additional discussion. Unless lawmakers repeal or postpone the measure, the tax is scheduled to begin on January 1, 2027.

Koo noted that scrapping the tax would require a broader review of South Korea’s capital markets tax structure, including whether cryptocurrency earnings should eventually be treated as capital gains rather than other income.