S. Korea petition to scrap 22% crypto tax tops 50,000

A citizen petition seeking to repeal a planned 22% tax on cryptocurrency investment gains has surpassed the 50,000-signature threshold required for review by the National Assembly’s Finance and Economic Planning Committee and now has more than 52,000 signatures. The tax is scheduled to take effect in January 2027.

Petition authors argued the measure would impose financial and reporting burdens on investors and limit economic mobility for younger people affected by high housing costs. In a translated statement, the petition authors wrote: “If taxation is enforced in order to secure short-term tax revenues, it is likely to lead to greater losses in the long term, namely, a contraction of industry and an outflow of capital and talent abroad.”

The petition also said taxing crypto at 22% while other asset classes receive more favorable treatment would weaken South Korea’s share of the regional crypto market and push capital overseas.

Industry data show the total value of cryptocurrencies held by South Korean residents fell from about 121.8 trillion won (roughly $83.3 billion) in January 2025 to about 60.6 trillion won (roughly $41.4 billion) by February 2026. Daily trading volume on the country’s five largest exchanges declined from about $11.6 billion in December 2024 to around $3 billion in February 2026.

Regulatory proposals have also drawn criticism. In March, the Financial Services Commission and the Financial Intelligence Unit proposed a rule to automatically flag as suspicious any crypto transactions above 10 million won (about $6,630) sent to or from foreign crypto wallets. Industry groups and exchanges have warned that the reporting requirement, together with stronger anti-money-laundering and know-your-customer controls, would create operational burdens for platforms and could discourage trading.

The Finance and Economic Planning Committee must review public objections to enacted or proposed tax measures. The committee’s review requires lawmakers to examine the petitioners’ grievances and decide whether to hold hearings or propose revisions; it does not guarantee any change to the tax plan.

Supporters of the tax say the measure is intended to broaden the tax base and bring digital assets into the formal tax system. Opponents say the combination of a high tax rate and tighter reporting rules risks reducing domestic activity and encouraging investors to move funds offshore.

Public responses to the petition reflect an ongoing debate in South Korea over how to regulate and tax cryptocurrencies while addressing market activity, investor protection and fiscal revenue needs.