South Korea’s crypto tax delay petition surpasses 50,000 signatures, forcing legislative review

More than 50,000 South Korean crypto investors have signed a national petition demanding the government delay its planned virtual asset income tax by two years. That signature count crosses the threshold required to force the country’s National Assembly to formally review the proposal.

The petition, titled “Petition for a Two-Year Deferral of Coin Taxation,” asks lawmakers to push the tax start date from January 1, 2027, to 2029. It accumulated roughly 51,000 signatures between late August and September 13-14, hitting the magic number in about three weeks. The petition is now expected to land on the desk of the Strategy and Finance Committee for assessment.

What the tax actually looks like

South Korea’s planned crypto tax carries a combined rate of 22%, split between a 20% national levy and a 2% local tax. It applies to annual virtual asset gains exceeding 2.5 million won, which translates to roughly $1,650 to $1,800.

Petition signers argue the infrastructure needed to actually enforce the tax properly doesn’t exist yet. Decentralized transaction tracking systems remain inadequate, and investor protections haven’t caught up to the ambition of the tax code. Their concern is straightforward: taxing something you can’t properly track creates problems for compliant investors while doing little to capture revenue from those operating outside centralized exchanges.

Second petition, same year

This isn’t even the first time South Korean crypto investors have rallied this year. Back in May, a separate petition crossed the same 50,000-signature threshold, though that one went further. It called for the outright repeal of the 22% virtual asset tax, not just a delay.

The nominee for deputy prime minister has publicly stated the government intends to enforce the tax as planned, leaning on the principle that income should be taxed where it is earned.

The capital flight question

Petition supporters warn about market contraction and capital flight. If investors preemptively move assets to jurisdictions with lower or no crypto taxes, South Korea could end up with less tax revenue than it would have collected under a more gradual implementation.

Dunamu, the company behind the Upbit exchange, one of South Korea’s largest crypto trading platforms, has projected a steep decline in its own corporate tax payments tied to anticipated market effects of the new tax.

What happens next

The broader context matters too. South Korea classifies virtual asset gains as “other income,” a category that comes with a notably low deduction threshold compared to traditional investment income. Stocks, for instance, receive more generous treatment.

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