South Korea's Ministry of Economy and Finance has confirmed that a long-delayed tax on cryptocurrency gains will take effect on January 1, 2027, giving the country's 13 million crypto investors their clearest deadline yet for compliance.
Moon Kyung-ho, director of the ministry's income tax division, made the announcement at an emergency parliamentary forum on virtual asset taxation held at the National Assembly Members' Office Building in Seoul on Thursday, Edaily reported . The forum was co-hosted by Representative Park Soo-young of the People Power Party and the Korea Tax Policy Association.
Moon told attendees: "We will proceed with virtual asset taxation as scheduled in January next year" — the first direct public confirmation from the ministry that the 2027 start date is firm after multiple prior delays.
Under the current Income Tax Act, profits from the transfer or lending of virtual assets will be classified as "other income" starting January 1, 2027. Investors earning more than 2.5 million Korean won (~$1,800) annually from crypto activity will face a combined 22% tax, made up of a 20% income tax and a 2% local surcharge. The rule is expected to apply to an estimated 13.26 million investors.
The announcement ends, at least for now, a prolonged political saga. The crypto tax framework has been delayed twice before, with the original 2025 start date pushed back to 2027 following political disagreement and industry concerns over exchange readiness and threshold design. More recently, the ruling People Power Party had introduced a bill to scrap the tax entirely before the 2027 deadline. Thursday's statement signals the ministry is proceeding independently of that legislative effort unless lawmakers change the law before the start date.
Implementation work is underway. The National Tax Service has held multiple working-level meetings with South Korea's five major exchanges — Dunamu (Upbit), Bithumb, Coinone, Korbit, and Gopax — to prepare a draft notice for legislative review. The first full tax filing period for affected investors is expected in May 2028, covering income earned in 2027.
The crypto industry is also pushing back on a parallel regulatory development. DAXA, the industry body representing 27 registered virtual asset service providers, warned that proposed changes to South Korea's anti-money laundering rules — which would require exchanges to flag all overseas-linked transfers of 10 million won or more as suspicious — would push reported cases from around 63,000 annually to more than 5.4 million, making compliance operationally unworkable.
South Korea's crypto market is large enough that the tax framework's design choices carry significant weight. Upbit alone is consistently among the world's top exchanges by daily volume, and the country has historically been among the most active retail crypto markets globally. Whether the 2.5 million won threshold — a relatively low bar — and 22% rate affect trading behaviour when January 2027 arrives is a question the industry will be watching closely.
