South Korea has confirmed that it will tax cryptocurrency gains starting from January 1, 2027, ending years of debate.

**May 8** South Korea’s Ministry of Economy and Finance confirmed it will tax cryptocurrency trading profits starting Jan. 1, 2027, ending years of political debate and repeated delays over the digital asset tax framework. The announcement came from Moon Kyung-ho, director of the Income Tax Division, at a virtual asset tax emergency forum held at the Seoul National Assembly. Under South Korea’s *Income Tax Act*, profits from crypto transfers or lending will be classified as “other income” beginning in 2027. Annual gains exceeding 2.5 million South Korean won (≈$1,800) will face a 22% combined tax rate—20% national income tax plus 2% local income tax. The government estimates roughly 13.26 million crypto investors will be affected. Despite calls from the opposition party and some industry figures to scrap the tax entirely or delay it further (citing unfair treatment compared to the stock investment income tax abolished at the end of 2024), the government says it will proceed as planned. The National Tax Service is finalizing operational guidelines and coordinating with the country’s top five exchanges on technical reporting and compliance systems. Detailed legislative guidance—covering exchange reporting requirements, investor disclosures, and rules for staking, lending, and airdrop income—is expected by 2026. Separately, South Korea is tightening digital asset market oversight: it recently amended the *Foreign Exchange Transaction Act* to include overseas crypto transfers and cross-border activities in its expanded regulatory scope. Analysts note the country’s model could serve as a benchmark for other Asian regulators.