South Korea is expected to begin taxing capital gains on digital assets from 2023, a year later than initially planned January 2022, upon bipartisan agreement to win over young voters in the presidential election in March.

The legislative committee on taxation on Sunday voted for revising the taxation law to begin digital asset taxation in January 2023 instead of initially planned January 2022, the National Assembly said Monday. The committee will table the decision at the plenary meeting on Tuesday, which will then make to the National Assembly’s general meeting scheduled to open in early December.

The delay in taxation drew bipartisan agreement.

The committee is seeking to change the revised income tax legislation, which passed the National Assembly in December last year. The lawmakers had approved revising the law on reporting and use of certain financial transaction information, which defines income from digital asset trade as other income and imposes a tax on annual gains exceeding 2.5 million won ($2,093.80). The revised law is set to take effect in January 2022.

There have been concerns over taxation when the digital asset industry is still in its fledgling stage.

Analysts suspect rivaling lawmakers reached a rare agreement to push back the timetable on taxation to woo young voters, who are avid investors in cryptocurrency. The country votes the next president in March 2022.

By Moon Ji-min and Cho Jeehyun

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]