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[Executive Summary]
- Recent concerns regarding the taxation on virtual assets are accumulating, as the National Assembly of Korea has been stagnant for a while due to disputes between the opposing political parties, and the promise by the government of pushing back the taxation on virtual assets to 2025 seemed to be compromised. Many legislative bills, including the legislative bill Yoon Suk-Yeol’s administration proposed to postpone the taxation on virtual assets for 2 years (“the Legislative Bill”), have not been passed due to this political strife. However, it is expected of the National Assembly to start serious negotiations on passing the Legislative Bill very soon, as the Legislative Bill will be automatically presented at the plenary session of the National Assembly.
Recent concerns regarding the taxation on virtual assets are increasing, as the National Assembly of Korea has been stagnant for a while due to various disputes between the opposing political parties, and the promise by the government of pushing back the taxation on virtual assets to 2025 seemed to be compromised.
Many legislative bills, including the legislative bill that the Yoon Suk-Yeol government proposed to the National Assembly in September to postpone the taxation on virtual assets for 2 years (“the Legislative Bill”), have not been passed or enacted, due to this political strife. The Legislative Bill must be passed by the National Assembly before the end of the year for the current taxation plan to be postponed. Under the current taxation law, anyone who earned more than 2,500,000 KRW from investing in virtual assets will be subject to a 20 percent tax, starting from 2023.
However, on November 21st, the government announced that its stance on postponing the taxation on virtual assets remains the same, and that the proposed Legislative Bill will be discussed soon in the National Assembly. More recently, on November 30th, the Chairman of the National Assembly assigned the Legislative Bill to one of 25 “Proposed Legislative Bills Ancillary to Tax Budget Proposal,” which means that the Legislative Bill will be submitted to the plenary session of the National Assembly in early December without having to go through the standing committee of the National Assembly, possibly expediting the process of the Legislative Bill passing the National Assembly. The Chairman also asked the political parties to discuss and consult continuously so that the Tax Budget Proposal and the legislative bills ancillary to it can be settled as soon as possible. Therefore, it is expected of the National Assembly to start serious negotiations on passing the Legislative Bill very soon (early December), as the Bill will be automatically presented at the plenary session of the National Assembly.
On December 2nd, the Chairman of the National Assembly refused to hold the plenary session planned for the day, due to the opposition party demanding a session to discuss the topic of removing the current Minister of the Interior and Safety. The Chairman announced that it is his opinion that the National Assembly should first discuss and pass the Tax Budget Proposal for public welfare and economy, instead of engaging in another political-fueled warfare in the National Assembly. The Chairman added that the plenary session of the National Assembly will be held on December 8th and 9th.
Although it is difficult to predict with certainty when the Legislative Bill will be approved by the National Assembly, it is generally anticipated to happen soon because both the government and the National Assembly Chairman are working to pass the Bill. Follow our updates to discover any latest developments regarding this matter.
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