The government and the ruling party discussed whether to further delay digital asset taxation scheduled to take effect in January next year, but failed to reach a conclusion. They agreed to continue talks as opinions clashed between those calling for implementation as planned and those arguing it should take effect after improving tax infrastructure and fairness with overseas exchanges.

Oh Gi-hyeong (오기형), secretary of the National Assembly's Finance and Economy Planning Committee and a lawmaker of the Democratic Party, met reporters after the party-government meeting at the National Assembly on Tuesday. "Because taxation has been postponed three times, there are people who say it is time to tax, and there are also opinions calling for supplements on a few questions," he said. "We decided to check it a bit more at the party level," he added.

Digital asset taxation was introduced through a 2020 revision of the Income Tax Act and has been delayed three times to date. If there is no decision to delay it again, it will take effect from January 2027.

Under the current system, a combined 22 percent tax rate of other income tax and local income tax is applied to the amount remaining after a basic deduction of 2.5 million won is subtracted from annual income generated through the transfer or lending of digital assets.

Opinions also differ within the Democratic Party. Some argue taxation is needed for policy credibility since implementation has been postponed three times, while others say it should be delayed further in light of market conditions and the state of preparations. It was reported that many at the party's lawmakers' meeting held the previous day also raised the need for a delay.

Democratic Party leader Kim Min-seok (김민석) said on Tuesday discussions are needed. He cited whether taxation could lead to taxpayer distrust and confusion if implemented without sufficiently reflecting market characteristics and the trading environment, shortcomings in tax infrastructure, fairness issues with overseas exchanges, and how to listen to and reflect concerns of young people who have sought opportunities to build assets.

Cho Seung-rae (조승래), chair of the National Assembly's Finance and Economy Committee, said the political decision on whether to tax needs to be concluded first as the government is preparing a relevant notice on taxation.

Deputy Prime Minister and Minister of Economy and Finance Lee Hyeong-il (이형일) also explained that industry and experts are raising the view that changes in the market environment need to be reflected in the tax system.

Lee said there were also opinions calling for a comprehensive consideration of the global policy environment, including tax fairness with users of overseas exchanges. "We are carefully considering a reasonable plan that the public can accept and that can be implemented stably in the field," he said.

The ruling party and the government plan to reach a conclusion as soon as possible after gathering additional opinions, with only about 2 months left until the planned implementation. Kim has also previously said the issue should be settled within this year, and has foreshadowed intensive talks at the party-government level.