South Korea’s currency exchange may lose tax benefits

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The government proposed to exclude crypto-exchanges from the category of representatives of small and medium-sized businesses, for which the South Korean legislation provides for a lower tax rate

South Korean crypto-exchange exchanges in the very near future may lose tax benefits provided by the state to small companies. With the corresponding initiative, the government of the country proposed to exclude crypto-exchanges from the category of representatives of small and medium-sized businesses, for which the South Korean legislation provides for a lower tax rate (in some cases, the “discount” may be up to 100%).

Local tax legislation provides for a reduction in income tax for medium-sized companies by 50% -100% in the first five years of existence and by 5% -30% after the first five-year plan. But the authorities of South Korea believe that entrepreneurs from the crypto industry should not receive tax discounts stipulated by the legislation of the country, because “Maintenance of crypto-currency transactions is not an effective method of creating value added.”

The relevant bill will be considered by the National Assembly on August 31, and then it will be the subject of discussion at the parliamentary debate, where the final verdict on the possibility of making appropriate changes to the country’s tax legislation will be adopted.

It should be noted that companies that are engaged in research and development of solutions based on blockchain technology will continue to enjoy tax benefits, such projects, according to representatives of the South Korean government, stimulate the development of new technologies in the country.

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