S. Korea to levy 20% tax on cryptocurrency transactions starting next year as planned: govt.

South Korea plans to impose a 20 percent income tax on capital gains from cryptocurrency transactions starting next year as planned, the government announced Friday, despite growing investor calls for delaying the taxation plan.

The government announced the plan after discussing the matter during a vice-ministerial interagency meeting chaired by Koo Yoon-cheol, head of the government policy coordination under the Prime Minister's Office.

Gains from cryptocurrency transactions will be classified as "miscellaneous income" and will be subject to a 20 percent tax starting next year. Virtual asset gains must be reported when filing for general income taxes in May 2023.

The Financial Service Commission, the nation's financial regulator, was also designated as the top government office tasked with overseeing and regulating the virtual asset market. The science ministry was chosen to handle the promotion and growth of the related blockchain industry.

Authorities also decided to extend the government's special campaign period for monitoring and clamping down on illegal activities in the virtual asset market until September.

Last month, Finance Minister Hong Nam-ki said the government will press ahead with taxation on transactions of cryptocurrency, which financial authorities categorize as "virtual assets," not virtual currencies. (Yonhap)