South Korean authorities may impose a tax on crypto assets received during airdrops

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The South Korean Ministry of Strategy and Finance plans to introduce a new tax on crypto assets received during the free distribution of tokens.

The agency stated that airdrops are subject to the Inheritance and Gift Tax Act. In this case, the tax will be levied on the person to whom the crypto asset is transferred free of charge.

The person liable to pay the gift taxmust submit a declaration within three months after receiving the crypto asset. The Ministry intends to introduce a tax in the amount of 10% to 50%, depending on each individual case.

“Is a particular transaction subject toWhether virtual assets are gift taxed or not is a matter that must be determined based on the situation. For example, whether it is consideration or whether actual property and profits are transferred,” the department said.

The Ministry emphasized that it will take some time to review each individual case. However, it is not necessary that every distribution of crypto assets will be taxed.

Previously, the National Tax Service of SouthKorea (NTC) said it will crack down on tax evasion involving virtual assets such as cryptocurrencies and platforms that deal with them.