Korea's Cho Seung-rae Seeks Delay of Digital Asset Tax Decree Set for 2027

Cho Seung-rae's Deferral Request

Cho Seung-rae, who chairs the National Assembly's Policy Committee, said on Friday that South Korea should hold back its digital asset tax decree until lawmakers reach a decision on how the levy will work. Speaking at a meeting with digital asset business operators at the National Assembly members' office building in Yeouido, Seoul, Cho said he had conveyed the view during party-government consultations a few days earlier that the notice should wait until a conclusion on the tax is reached, and that he understands the government shares that position. The government had earlier reported a plan to finalize the decree by the end of October, a deadline now in doubt as the Assembly's own review of the tax direction continues. Cho said his committee has continuously checked the conditions, market environment and additional requirements surrounding the taxation through the recent National Assembly audit, adding that the market and the legislature agree a conclusion must come quickly with the implementation date approaching. He also pressed the government on what he described as a missing growth strategy for the sector, saying he had raised the problem with the administration at considerable length. The Ministry of Economy and Finance is preparing a comprehensive market-fostering plan together with the financial authorities, and Cho asked industry participants to put forward active opinions as that work proceeds. In his framing, industrial development and the tax framework must advance together, because a taxable base built on that foundation would sustain the market while reducing resistance to the levy. He closed the session by asking attendees for concrete and candid views, saying the process should unfold in a direction that grows the market and lifts acceptance of the tax.

The Democratic Party's request followed a party-government council on October 28 that debated whether to defer the tax and ended without a conclusion. At that session, party leader Kim Min-seok pointed to insufficient tax infrastructure and the risk of confusing taxpayers, and the two sides agreed to keep discussing the timing of implementation. Open issues the party has listed include securing transaction records of users of overseas venues, tax parity between domestic and offshore trading, and detailed criteria by transaction type. The party's concerns center on users of offshore platforms, some of them ranked among the Best Crypto Exchanges globally, whose order book records and transaction data sit outside the reporting net that domestic exchanges follow. The party's general meeting of lawmakers on October 27 also discussed a deferral without setting an official line. Kim Han-gyu, a senior floor leadership official, said no one spoke against the idea and that the mood inside the party appeared to be leaning toward another delay. Policy committee chairman Kwon Chil-seung laid out the split at the Friday meeting: under the principle that wherever income exists a tax should follow, some argue the levy must start on schedule, while others see an additional deferral as unavoidable because infrastructure lags a market that has shifted quickly toward offshore use. An unprepared tax could be a punishment and a source of confusion for honest taxpayers, Kwon warned. The party's stated worries include shrinking asset-building opportunities for young investors, domestic capital leaving for overseas markets and the absence of a loss carry-forward deduction. Under the current Income Tax Act, income from transferring or lending digital assets becomes taxable on January 1, 2027, with a combined 22% rate covering income tax and local income tax after a 2.5 million won annual deduction. The deferral request by itself does not move that date: any postponement requires the National Assembly to process an amendment to the law. The party took no formal position on a further deferral at the Friday session, and Kwon said its stance would be set soon based on the participants' views. Both sides also agreed on the need to enact the Digital Asset Basic Act, aimed at user protection and a sound ecosystem, at an early date.

Moving the 2027 Date Requires a Law

The decree request leaves the end-of-October publication deadline unresolved, but the statutory start of January 1, 2027 stands until the Assembly passes an Income Tax Act amendment, which turns any deferral into a vote in the chamber rather than an administrative step. The split inside the party between the taxing principle and the readiness concerns means a formal decision is still pending, and Cho's push to tie the levy to a market-growth plan points to a broader package, including the Digital Asset Basic Act, landing before the tax does. The date to watch is whether an amendment reaches the floor before the year-end session closes.