Is South Korea considering taxing NFTs?

Is South Korea considering taxing NFTs?

Vice President of the South Korean Financial Services Commission, Doh Kyu-sang, told the National Assembly yesterday that the South Korean government thinks NFTs can be taxed under existing regulations covering virtual assets. Doh added that the Ministry of Economy and Finance is currently preparing taxation on NFTs.

However, the FSC recognizes that not all NFTs should be taxed or classified as virtual assets, financial authorities believe that NFTs issued on a large scale with the intention of being used for investments or payments should be classified as virtual assets and taxed accordingly. At the national assembly meeting, Goh said that the full scope of taxable NFTs will be defined in the future by the tax authorities.

The debate on taxation of NFTs has been developing since last month when the minister Finance Officer Hong Nam-ki argued that NFTs are not part of virtual assets and therefore would not be taxed next year, although he recognized the need for further discussion.

L he amendment to South Korea's tax law requires income from virtual assets in excess of 2.5 million won (approximately $ 2,102) to be taxed at a rate of 20% starting January 1, 2022. L 'announcement sparked controversy, with investors claiming taxation is unfair, as crypto income is to be taxed over 2.5 million won, while a 20% tax on capital gains is expected to begin on January 1st. 2023 to 50 million won, equivalent to approximately $ 42,048.

Lawmakers from both the ruling Democratic Party and the Conservative People Power Party have proposed bills to postpone taxation on crypto earnings by one to two years. The tax subcommittee of the national assembly within the committee for strategy and finance has already begun to discuss policies to lighten the tax burden on virtual businesses.

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