South Korea Mulls Over Plans to Tax ICOs and Cryptocurrency

South Korea Mulls Over Plans to Tax ICOs and Cryptocurrency

The government of South Korea is reportedly planning to tax ICOs and cryptocurrency. This is in spite of the absence of a regulatory framework in the country.

The Korea Times reported that Finance Minister nominee, Hong Nam-Ki, disclosed the plans of the South Korean government to tax initial coin offerings (ICO) and digital currency. Nam-Ki, who was responding to a question in the South Korean National Assembly concerning the taxation of virtual assets in the country, submitted his answer in written form.

In addition, he stated that the tax system for cryptocurrencies would be finished in line with the “taxation infrastructure and progress by global stakeholders.” In his own words, Nam-Ki continues, “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.”

Taking into cognizance the current ban on ICO in the country, Nam-Ki declared that the government will study various factors to arrive at a definite stance on ICOs. Global trends, market conditions, and investor protection issues are some of the factors that would be examined.

Furthermore, the nominee stated that the government would form its orientation about ICOs from the results gotten by the survey carried out by the “financial regulatory market and experts.”

On his thoughts about digital currencies, Nam-Ki declared that they were “a phenomenon with no generally acceptable regulatory structure.” He also said that the industry, which consists of 2,000 cryptocurrencies traded globally with 160 traded in South Korea, should be regulated with caution.

The Finance Minister nominee also gave the assurance that government would “nurture blockchain technology,” since according to him, 90 percent of businesses can be classified under blockchain-related business. Apart from digital currency exchanges, these businesses can be labeled as venture companies.

The South Korean government has not been forthcoming about a standard regulatory framework for its local cryptocurrency industry. Towards the end of the second quarter of 2018, the country announced that it would commence the regulation of cryptocurrency exchanges. But less than a week later, the regulations were deliberately postponed without any explanations given.

In conclusion
The South Korean government is currently planning to tax ICOs and cryptocurrency, despite the absence of a regulatory framework in the country. This news was disclosed by the country’s Finance Minister nominee, Hong Nam-Ki, during an appearance before the South Korean National Assembly.

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