S. Korea To Tax Crypto Exchanges 24.2 Percent, In Line With Existing Tax Policy
The South Korean government has announced that crypto exchanges will be expected to pay 24.2% in taxes, just like all corporations that earn over 20 bln won a year.
Local news agency Yonhap reports that South Korean government has announced Monday, Jan. 22 that it will be collecting a 22 percent corporate tax and a 2.2 percent local income tax from the country’s cryptocurrency exchanges.
The tax announcement comes right after the conclusion of an unprecedented anti-money laundering probe into six major South Korean banks that showed a 36 times increase in commissions from virtual accounts linked to crypto exchanges, from 61 mln won ($57,340) in 2016 to 2.2 bln won ($2 mln) in 2017.
Yonhap reports that South Korean exchange Bithumb made 317.6 bln won ($295,368,000) last year in total, so is expected to pay about 60 mln won in taxes, according to the tax percentages announced Monday.
The announced tax percentages are in line with the South Korean tax code for all corporations that make a yearly income of over 20 bln won ($18.7 mln).
Bithumb, which is the largest exchange globally at $2.85 bln daily trading volume as of press time, was hacked in February 2017, losing about $7 mln in mostly Bitcoin and Ether. This security breach, along with several other breaches of South Korean exchanges, has recently been more definitively linked to North Korean hackers.
The South Korean government has recently been stepping up enforcement of cryptocurrency regulation within the country. Besides ordering the financial probe, the government has banned the use of anonymous virtual accounts, frozen the opening of new virtual accounts, and forbid underage and foreign users from trading on exchanges.
The South Korean public has fought back with a petition to stop the recent government regulations. After reaching the necessary 200,000 signatures, the petition is currently awaiting an official response from the government.