South Korea’s National Tax Service (NTS) has begun preparations for an AI-based system to track cryptocurrency investment gains as the government pushes to strengthen revenue collection, The Korea Times reported.
The agency said on Thursday it had opened bidding for an integrated platform designed to analyze virtual asset transactions for taxation ahead of the planned levy on virtual asset profits from January.
The 3 billion won ($2.02 million) project was put out for bid through the Public Procurement Service’s online procurement system, with the tax agency expecting to choose a contractor and sign an agreement later this month.
Work on the platform will begin in April, followed by testing phases ahead of a pilot program in November and a full rollout planned for November to December.
Targeting Hidden Income
According to the report, the new platform would strengthen the agency’s ability to handle large volumes of cryptocurrency trading data by embedding AI and machine learning tools, making it easier to detect potential tax avoidance, uncover hidden income among taxpayers, and flag irregular transaction patterns and other unusual activity.
The NTS also intends to distribute its virtual asset analysis findings, along with lists of suspected violators, to other state institutions, including the Korea Customs Service, the Ministry of Data and Statistics, and the Bank of Korea.
A Long-Delayed Digital Asset Tax
South Korea’s tax on virtual asset gains is now scheduled to take effect on Jan. 1, 2027, after being pushed back several times from its original 2022 start date to 2023, then 2025, amid political debate, investor resistance, and concerns that the reporting system was not yet ready.
Under the framework, virtual asset income above 2.5 million won will be subject to a 22% tax, comprising a 20% income tax and a 2% local income tax. The finance ministry has said it will revise the method for calculating the acquisition value of virtual assets and tighten documentation requirements for crypto transactions, as authorities refine the framework ahead of implementation.
The latest push to build an AI-based tracking platform appears to fit into Korea’s broader effort. Beyond setting the tax rate, the government has been tightening transparency rules around virtual assets by adding transaction details to customs-related tax reporting and creating a legal basis for automatic information exchange on cryptocurrency assets. Taken together, those moves suggest the new system could support enforcement as authorities prepare to implement the tax.
