South Korea Plans to Delay Crypto Income Tax Rule
- Korea's National Assembly proposed a delay in the crypto tax rule to push the implementation to January 2022.
The planning and finance committee of South Korea’s national assembly reportedly suggested delaying the commencement of the cryptocurrency income tax rule to January 2022. South Korea originally planned to implement the mentioned rule by October 2021.
According to a report published by South Korean media the DONG-A ILBO, the assembly is pushing to delay the rule as crypto exchanges operating in the country require more time to build an effective taxation infrastructure.
The Ministry of Economy and Finance introduced amendments in tax rules earlier this year to charge South Korean residents a 20% income tax on cryptocurrency gains worth more than 2.5 million won, or around $2000.
The report states that the South Korean Congress is worried about the fact that the crypto industry is not ready to implement such changes in a short time. In addition to the crypto income tax rule, exchanges need to enforce the ‘Special Financial Information Act’ by next year.
Information Act
According to the report, crypto exchanges are running out of time in Korea. Under the "Specific Financial Information Act", the exchanges must complete a reporting system by September 2021, to complete the KYC of clients in order to show verified names of deposit and withdrawal accounts. The report cites that some investors are unhappy with recent initiatives by the Government related to crypto regulations. "We need to listen fully to the infrastructure and readiness of the (industry). I feel that the young people can react with greatness, and it is good to implement it quickly, but it is important to calmly take on the system while securing a considerable degree of sympathy,” the Democratic Party's employment wing member said in a statement.
Finance Magnates earlier reported a decision by South Korea’s Financial Services Commission (FSC) to ban anonymous digital currencies that possess a high-risk of Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Read this Term. The country also launched a crackdown on several crypto exchanges in the past.
The planning and finance committee of South Korea’s national assembly reportedly suggested delaying the commencement of the cryptocurrency income tax rule to January 2022. South Korea originally planned to implement the mentioned rule by October 2021.
According to a report published by South Korean media the DONG-A ILBO, the assembly is pushing to delay the rule as crypto exchanges operating in the country require more time to build an effective taxation infrastructure.
The Ministry of Economy and Finance introduced amendments in tax rules earlier this year to charge South Korean residents a 20% income tax on cryptocurrency gains worth more than 2.5 million won, or around $2000.
The report states that the South Korean Congress is worried about the fact that the crypto industry is not ready to implement such changes in a short time. In addition to the crypto income tax rule, exchanges need to enforce the ‘Special Financial Information Act’ by next year.
Information Act
According to the report, crypto exchanges are running out of time in Korea. Under the "Specific Financial Information Act", the exchanges must complete a reporting system by September 2021, to complete the KYC of clients in order to show verified names of deposit and withdrawal accounts. The report cites that some investors are unhappy with recent initiatives by the Government related to crypto regulations. "We need to listen fully to the infrastructure and readiness of the (industry). I feel that the young people can react with greatness, and it is good to implement it quickly, but it is important to calmly take on the system while securing a considerable degree of sympathy,” the Democratic Party's employment wing member said in a statement.
Finance Magnates earlier reported a decision by South Korea’s Financial Services Commission (FSC) to ban anonymous digital currencies that possess a high-risk of Money Laundering Money Laundering Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Money laundering is a blanket term to describe the process by which criminals disguise the original ownership and proceeds of criminal conduct by making such proceeds appear to be derived from a legitimate source.Money laundering is an issue that traverses countless industries and sectors, which includes the financial services space. Though criminal money may be successfully laundered without the assistance of the financial sector, billions of dollars’ worth of criminally derived money are laundered through financial institutions each year.This is not entirely surprising given the structure of the financial services industry and the nature of products and services offered by its participants.An ecosystem that involves the management, control, and processing of finances is inherently vulnerable to abuse by money launderers.Money Laundering ExplainedThe act of laundering is committed in circumstances in which an individual or entity is engaged in an arrangement that involves the proceeds of crime. These arrangements include a wide range of business relationships, i.e. banking, fiduciary and investment management.However, the degree of knowledge or suspicion will depend upon the specific offense but will usually be present where the person providing the arrangement, service or product knows, suspects or has reasonable grounds to suspect that the property involved in the arrangement represents the proceeds of crime. In some cases, the offence may also be committed where a person knows or suspects that the person with whom he or she is dealing is engaged in or has benefited from criminal conduct.One of the primary criticisms against cryptocurrencies has been their propensity for money laundering. Their anonymous nature and unregulated network structure make them ideally suited for money launders. Read this Term. The country also launched a crackdown on several crypto exchanges in the past.