South Korea has delayed its cryptocurrency taxation policy implementation by two years, citing the need for further systemic refinements.
The decision was announced by Democratic Party representative Park Chan-dae during a National Assembly press conference. Following extensive discussions, Park emphasized the necessity for comprehensive reforms in virtual asset regulations. This postponement occurs amid heightened political tensions and increased market volatility.
Virtual Asset Tax Implementation Postponed
The Democratic Party confirmed that the previously planned virtual asset tax will now be deferred. The party defended this move, stating the current regulatory framework requires additional improvements to ensure systematic taxation.
This announcement coincides with debates on several supplementary budget bills. Among 13 government-proposed bills, eight were marked for immediate handling in the upcoming plenary session, while five remain under further review. Notably, the inheritance and gift tax bill faced rejection, with criticism focusing on its provision to lower maximum inheritance tax rates.
The party also maintained opposition to the government's separate taxation of dividend income. Representative Park stated this disproportionately favors the wealthy. Discussions between ruling and opposition parties are expected to continue, with the National Assembly Speaker facilitating potential last-minute negotiations.
Market Volatility Amid Political Developments
South Korea's political developments continue to significantly impact cryptocurrency markets. Earlier this month, cryptocurrency prices experienced disruptions on Upbit's KRW trading pairs following the announcement of emergency measures.
Bitcoin briefly plunged to $66,000 (₩88,266,000) before recovering, though it traded at a discount compared to other exchanges. Similarly, XRP dropped to $1.16 (₩1,623) before rebounding above $2.40 (₩3,412), while maintaining higher valuations globally.
These fluctuations coincided with broader financial market disruptions, including stocks and bonds. Notably, President Yoon Suk-yeol's declaration of emergency measures marked the first martial law implementation since the 1980s, amplifying economic uncertainty.
FAQ Section
Why did South Korea delay cryptocurrency taxation?
The delay aims to refine regulatory frameworks and ensure systematic tax collection, addressing gaps in the current system.
How long is the cryptocurrency tax postponed?
The implementation is postponed for two years from the original schedule.
Which cryptocurrencies were most affected by recent market volatility?
Bitcoin and XRP showed significant price swings on Upbit's KRW pairs during political instability.
What broader financial impacts occurred alongside crypto volatility?
Stock and bond markets faced parallel disruptions during the emergency measures period.
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