South Korea’s tax authority is preparing to deploy artificial intelligence to track cryptocurrency investment gains as the government moves closer to implementing a long-delayed tax on digital assets.
South Korea’s tax authority has opened bids to build an AI-backed system to analyze cryptocurrency transaction data, as the government prepares for its planned 2027 tax on acquisitions of digital assets, according to a report by The Korea Times on Thursday.
The project, valued at about 3 billion Korean won (about $2 million), will establish an integrated platform capable of processing large volumes of crypto trading data. NTS plans to use AI and machine learning to identify unusual transaction types and patterns and detect potential tax evasion, The Korea Times reported.
The move comes as South Korea is reportedly preparing to start taxing cryptocurrency investment profits in January 2027, applying a combined 22% levy on profits above 2.5 million won ($1,700).
NTS plans a system for analyzing crypto transaction data.
According to The Korea Times, the tax authority plans to select a contractor by March. System design is expected to begin in April, with testing phases scheduled throughout the year. A pilot program is planned for November, and the system is expected to be operational between November and December.
NTS said the platform will help authorities systematically manage and analyze large volumes of virtual asset transaction data.
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The system is expected to assist in tax audits, identify hidden income from delinquent taxpayers and detect potential tax evasion linked to crypto trading.
The tax agency said it plans to share analysis data and lists of suspected criminals with other agencies, including the Korea Customs Service and the Bank of Korea.
South Korea Prepares for 2027 Crypto Tax Rollout
South Korea’s crypto tax framework has been repeatedly postponed despite being approved several years ago.
In 2024, lawmakers debated whether to implement the country’s proposed crypto-gains tax in 2025 or delay it further amid industry opposition and political disagreement over tax limits. Since the law was passed in 2020, its implementation has already been delayed three times.
The policy will impose a 20% income tax and an additional 2% local tax on cryptocurrency profits exceeding 2.5 million won annually. The tax is now expected to take effect in January 2027, according to The Korea Times.
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