South Korea’s regulator: Crypto tax deferral is inevitable for these reasons!
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Answer South Korea’s regulator: Crypto tax deferral is inevitable for these reasons!
The steps taken by South Korea’s Ministry of Strategy and Finance to tax crypto income as planned by January 1 may be an exercise in futility.
This was told by one of the country’s legislators, Noh Wong-rae of the Democratic Party of Korea, who also told that the relevant authorities or stakeholders lack the appropriate infrastructure to make this taxation policy a success, due to the conflict of these plans.
In the event that the relevant tax infrastructure is not adequately prepared, deferring taxes on cryptocurrencies is no longer an option but an inevitable situation.
Rep. Noh noted that in cases such as transactions between external cryptocurrency exchanges or peer-to-peer (P2P) transactions, it is difficult to secure tax data, which can create a tax blind spot.Read:What is the effect of adding Ethereum futures contracts to the Chicago Stock Exchange “CME” on the price of Ethereum?
In order to cover up these blind spots, the legislator said other lawmakers will be persuaded that the pending loopholes in tax policy can be pursued as necessary.
I will explain:
Since the laws related to tax deferrals and real tax cuts are currently pending in the Standing Committee, we will actively persuade our fellow legislators so that they can be dealt with in the regular National Assembly.
While the original bill classified income earned from crypto transactions as other income, the legislator said it would also push to change that language so that cryptocurrency income is now taxed as income from financial investments.
Crypto tax has become a remarkably polarizing topic:
The anonymous nature of digital currencies has made them a difficult asset class to tax.
Earlier in August, the US Senate experienced some turmoil when some provisions of the billion-dollar infrastructure bill were left unexplained.
One way to sponsor the bill was to tax key ecosystem stakeholders including miners.
The entire crypto community rebelled against the bill at the time.
Getting the right data is crucial to getting your tax practice right.Read:Cryptocurrency security firm Fireblocks is on trial after failing to protect more than $70 million worth of Ethereum
While the US has had its fair share of turmoil regarding this topic.
Some South Korean trading platforms that will not be able to provide appropriate documentation for user identification will be closed before the September 24 deadline.
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