SEOUL, South Korea – The government of South Korea declares that they will not profit further from digital asset trading for now. However, the government stated that tax exemption would be amended in the future.
The Ministry of Finance and Strategy of South Korea declared that it will not put a tax on cryptocurrency trading for now, and it stated that the government would not profit from digital currencies.
According to reports, the South Korea government commented that under the current tax regulations that taxes will not be levied on digital asset trading. As of the moment, this Asian country has not openly defined its standings like “virtual currency.” Hence, incomes from crypto transactions will not be taxed at all.
As per the Ministry of Finance and Strategy, incomes from individual digital asset transactions have not recorded a profit. Hence, these are not taxable. On the other hand, the tax exemption will not be for long.
The Ministry of Finance and Strategy of South Korea also provided suggestions that the tax exemption on digital asset incomes will not be for too long. In the future, the Korean government aims to amend the tax policy so they can finally put taxes on cryptocurrency exchanges.
Significantly, the cryptocurrency community anticipates the government to provide a detailed definition of cryptocurrency. Moreover, they clearly stated that incomes are classified as capital gains. Also, it includes how to maintain exchange records for law execution appropriately.
An official in the Ministry of Finance and Strategy unveiled that the conference already happened. Hence, it plans to issue the revised tax bill in the first two quarters of 2020.
As per the Ministry of Finance and Strategy, they are making a taxation plan for digital assets by widely reviewing the taxation of leading countries. The steadiness with accounting principles. Also, it includes trends in global deliberations to avoid money laundering.
The National Tax Service (NTS) of South Korea provided more awareness of the situation. They classified the cryptocurrency gains of foreign traders as miscellaneous profits. The category allegedly includes irregular advantages, such as lottery winnings or rewards. On the other hand, other methods of earnings from stock trading or real estate fall under capital incomes.
The publication unveiled that the government assembles tax on capital incomes for each deal, while tax for miscellaneous profit is collected per year. Hence, if digital revenues are classified as capital incomes, the government will have to obtain every exchange record from domestic trading.
On the other hand, Ahn Chang-Nam, a tax professor at Kangnam University, stated that it’d be challenging for the government to know more about each crypto transaction. It might be better for the NTS to categorize incomes from the crypto-asset exchange as different assets.
Moreover, KT, a South Korean telecommunication company, unveiled plans to launch a digital currency in their local area, wherein the proposed name is Dongbaek Currency.