Hong Nam-ki Opposed to the Ruling Party: "Virtual Asset Taxation Starting from 2023"

Answer to Government Questions in the National Assembly on the 15th

Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki (left) attends the government economic sector questioning session held at the National Assembly plenary session on the 15th, responding to questions from lawmakers. Photo by Yoon Dong-joo doso7@

[Sejong=Asia Economy Reporter Moon Chaeseok] Deputy Prime Minister and Minister of Economy and Finance Hong Nam-ki said on the 15th that it is "desirable to implement as originally intended from 2023" regarding the ruling party's proposal to reconsider taxation on virtual assets.

On the same day, during the National Assembly's government questioning session on economic matters, Hong Nam-ki responded to a question from Kim Byung-wook, a member of the Democratic Party of Korea, asking his opinion on reconsidering virtual asset taxation by saying, "It is difficult to accept the party's opinion," and added, "I believe it is desirable to implement it as originally intended."

Earlier, the National Assembly passed an amendment to the Income Tax Act imposing taxes on virtual assets at the end of last year. According to the amendment, from January 1 next year, income earned from transferring or lending virtual assets will be classified as 'other income,' and if it exceeds 2.5 million KRW annually, it will be taxed separately at a rate of 20%.

For example, if an investor buys Bitcoin worth 10 million KRW and sells it for 20 million KRW, the capital gain of 10 million KRW will have a deduction of 2.5 million KRW, and tax will be imposed on 7.5 million KRW, resulting in a tax payment of 1.65 million KRW. In actual taxation, transaction fees, which are about 0.1~0.25% of the transaction amount, are deducted as incidental expenses, so the tax may be lower than this.

Regarding this, Yoo Dong-su, head of the Democratic Party's Virtual Asset Task Force (TF), said on the 13th, "The taxation method varies depending on how the law defines the nature of virtual assets, and the tax imposition has not been finalized," adding, "Financial assets have a deduction amount of 50 million KRW, and other assets have a deduction amount of 2.5 million KRW, so there is room for change. Therefore, depending on how virtual assets are defined, the tax aspect should also be kept open for consideration."

Regarding this, Hong Nam-ki also dismissed the ruling party's position on reconsidering virtual asset taxation at a press briefing held at the Government Complex Sejong on the 13th, saying, "I have not heard any other discussions besides the current decision on taxation of virtual assets."

This content was produced with the assistance of AI translation services.