Lawyer Ahn Hyun-guk of Pacific Law Firm pointed out in a tax and finance contribution that "while there is some validity to the stance that taxation should be implemented as planned, several challenges must be addressed for actual implementation." The main points are as follows.
-With the abolition of the financial investment income tax, the general framework for capital gains taxation has disappeared. It is necessary to comprehensively discuss the basis for separately taxing only virtual assets, how to ensure fairness with the current stock taxation system that only taxes capital gains of major shareholders, and the long-term possibility of transitioning to capital gains tax.
-The timing of taxation and the criteria for calculating acquisition costs for various transaction types such as staking, airdrops, hard forks, mining, NFTs, and DeFi must be clarified at the legal level. The wording 'transfer or loan', which assumes simple buying and selling, makes it difficult to encompass all various transaction forms. To reduce tax loopholes and arbitrary interpretations, it is necessary to specify criteria for each transaction type.
-Funds flowing out to overseas exchanges, decentralized exchanges, and peer-to-peer transactions are also a problem. CARF (Crypto Asset Reporting Framework) has established its institutional framework through legal amendments and the enactment of implementation regulations, but significant challenges remain, such as expanding participating countries and stabilizing operations. Furthermore, decentralized exchanges (DEX), peer-to-peer (P2P) transactions, and DeFi are blind spots for reporting obligations. Therefore, while enhancing the effectiveness of the information exchange system, incentives for staying with domestic exchanges must also be considered. If only the tax burden is increased, there is a concern that tax sources may instead move overseas.
