Nov 24
2013

Korea Announces Favorable Tax Policy for BTC

The bitcoin community in Korea is small, but growing, and it seems that governments around the world are taking the US Senate’s recent hearings as a signal to begin determining at least temporary policies regarding our favorite cryptocurrency.

Posted in Korea’s Bitcoin Community on Facebook is a statement from Korea’s National Tax Service stating that Koreans will not be taxed for capital gains on bitcoin for the time being.

While this is clearly good news for the few long-time miners in Korea as well as speculators that have experienced a windfall in the past month, it is important to remember that this is not a good long-term position toward bitcoin. Essentially, the Korean government is taking the stance that bitcoin investments are not real.

Currently, bitcoiners are happier to be left alone by the governments of the world and such a policy supports this in the long term. But if we hope to see bitcoin rise to a more commonly-accepted and competitive currency, we will need governments to recognize that BTC does, in fact, bear value and follow “safe and sane” regulatory procedures. While this is not the time to hold the argument over how much and what kind of regulation would be appropriate and positive, I think that most bitcoiners will agree that we don’t want it to be seen as monopoly money forever. Near-universal recognition and respect is needed.

4 comments

  1. Jae Kwon says:

    This is a fantastic policy, and does not imply that Bitcoin is not taken seriously.

    Bitcoin is in the beginning of its “vertical” phase of adoption, where it grows to an estimated 1 trillion dollars of valuation. The best policy for a government to take at this point is not to encumber the purchasing of it with taxes and regulations (I’m looking at you, U.S.), but to encourage adoption with no taxes on gains, and only push regulation that would help adoption.

    The government can always tax after the adoption phase has completed. Otherwise, it risks losing out in the global race to obtain Bitcoins.

    It may be an oversight, but it is a good policy nonetheless. With regards to recognition and respect, one only needs to preach what Bitcoin is. It is the duty of the Bitcoin supporter to distribute the information about the virtues of Bitcoin to the people, not the government.

    • Pokey says:

      @Jae Kwon – why on Earth would the US, owner of the USD, not tax bitcoin? That’s essentially the equivalent of saying if I lived in the US and was payed entirely in JPY then they shouldn’t tax it. It makes no sense whatsoever. If Bitcoin wants to be a widely used currency, it needs to be treated like one – and as such, needs to have some taxing and regulation.

    • Jae Kwon says:

      I’ve had more time to reflect on this, and I retract this statement.

  2. eggdescrambler says:

    I don’t care if any governments take the stance bitcoin are not real, I actually don’t care what they think. But I’m quite happy Koreans will not be taxed on it. That actually can accelerate its adoption since it can be used without paperwork and tax issues.

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