The South Korean government has planned to impose tax on crypto and ICOs, Inspite of the unavailability of regulatory framework.
Crypto ICO taxation policy
The Korea times reported that the Finance Minister nominee, Hong Nam-ki disclosed that the government of South Korea has plans to impose tax on ICOs and crypto.
Nam-Ki said that the tax method for cryptocurrencies would be completed in line with taxation infrastructure as well as developments made by global stakeholders. He said: “A task force consisting of experts from relevant government agencies including the National Tax Service and the private sector will be formed to examine overseas examples and hammer out the taxation plan.”
Nam-ki said that the Korean government would come to a conclusion concerning ICOs after it must have considered various factors such as global trends, market conditions and investor protection issues.
He also maintained that, the results obtained from the survey conducted by experts and financial regulatory market would serve as the government’s orientation regarding ICOs.
In addition, the finance minister nominee said that blockchain technology would be nurtured by the government, making reference to the fact that most businesses are blockchain related.
Cryptocurrency Exchanges in Korea rendered helpless in the face of Chinese influx
The South Korea market is experiencing the arrival of Chinese virtual currency exchanges such as Huobi, Binance and OKEx. Recently, OKEx made an announcement about its entrance into the South Korean market, and Huobi had initially made it known that traders would be allowed to utilize the Korean market to trade cryptocurrency. Binance has made efforts to expand within the South Korean community. The arrival of these exchanges has however rendered cryptocurrency exchanges powerless.
The Korean government has been unstable in issuing a regulatory framework in the crypto industry. At the end of the first half of 2018, the country announced its intention to regulate digital currency exchanges. However, some days after the announcement, the government intentionally postponed the regulations.
Of recent, the Korea Bar Association advised the government to make laws that would improve investor’s protection and develop the crypto industry.