RIVAL PARTIES AGREE ON TAX BREAKS

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Rival parties have agreed to postpone a planned taxation on cryptocurrencies for a year. To ease the tax burden on single-home owners, they also decided to raise the threshold price of houses subject to transfer tax from 900 million won to 1.2 BILLION won.

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The parliamentary strategy and finance committee decided to postpone the planned taxation on digital currencies by a year at a meeting of its subcommittee on tax. With the decision, virtual currency investors will be slapped with a 20 percent tax on capital gains they make for a year starting from 2023. And they will receive the first tax bills in 2024. The parliamentary committee explained the postponement is inevitable, as preparations have not yet been made fully and the tax on cryptocurrencies must be levied in 2023 along with the tax on financial investment gains. The decision is also based on the opinion that the tax on virtual assets is higher than that on stock transactions. Under the current plan, a tax will be imposed for cryptocurrency gains exceeding 2.5 million won, while gains of over 50 million are subject to tax for stock investors. During the grace period, the National Assembly will likely discuss raising the taxation standard to the same level as stock investments. However, the government is maintaining its position that digital currencies are not the same as stocks, which play a productive role like helping businesses raise necessary funds. The parliamentary committee also decided to ease a tax burden on single-home owners. The ruling and opposition parties agreed to raise the threshold price of houses subject to the transfer tax from 900 million won to 1.2 billion won. However, it did not approve a bill imposing lower taxation rates to those who have owned single houses for a long time. The revision to the income tax law will be submitted to the plenary session of the National Assembly next month after passing the committee’s general meeting on Tuesday.