Latest news with #financeministry
Yahoo
a day ago
- Business
- Yahoo
Indonesia to raise tax rate on crypto transactions
JAKARTA (Reuters) -Indonesia will raise taxes on cryptocurrency transactions, with a higher rate on trades hosted by overseas bourses, starting from August 1, according to a new finance ministry regulation. Cryptocurrencies have become a popular investment option in Southeast Asia's largest economy, where they are legally traded but cannot be used as a means of payment. The total transaction value of crypto assets tripled in 2024 from a year earlier to more than 650 trillion rupiah ($39.67 billion), regulator data showed. There were over 20 million users in crypto exchanges in the country in 2024, more than the number of investors in the stock market. Under the new regulation, sellers of crypto assets in domestic exchanges must pay a 0.21% tax on the transaction value, up from 0.1% previously, while sellers in overseas exchanges are charged 1%, from 0.2% previously. However, buyers would no longer be subject to a value added tax (VAT). Under previous rules, buyers would pay 0.11-0.22% VAT. Indonesia also raised the VAT rate on mining of crypto assets to 2.2%, from 1.1%. A 0.1% special income tax rate on crypto mining was removed, subjecting such income to either personal income tax or corporate tax rates, effective in 2026. Binance-backed Tokocrypto said it welcomed the changes, which reflect Indonesia's shift in categorising cryptocurrencies as financial assets and away from seeing them as commodities, but it proposed a grace period of at least a month to allow companies to adjust. "We also emphasize the importance of strengthening oversight and tax enforcement on crypto asset transactions conducted through foreign platforms," Tokocrypto said in a statement. The company called for fiscal incentives to bolster innovation in the industry, as the new crypto tax rate would still be higher than the capital gains tax rate used in stock market investments. ($1 = 16,385 rupiah) Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Reuters
a day ago
- Business
- Reuters
South Korea to roll back tax cuts as new leader seeks expansionary policy
SEOUL, July 31 (Reuters) - South Korea's government put forward plans on Thursday to roll back recently imposed tax cuts, such as those on corporate income and stock investments, as the country's new leader seeks an expansionary fiscal policy to support an economic recovery. In annual tax code revisions, the finance ministry has proposed raising taxes on corporate income and stock investments, which had been cut by the former conservative administration of Yoon Suk Yeol, who was impeached and removed from office over his failed martial law order. Liberal President Lee Jae Myung, who took office on June 4, has argued for an expansionary fiscal policy to boost economic growth. His government has already introduced a supplementary government budget of 31.8 trillion won ($23 billion) including a consumer voucher programme offering cash handouts to all citizens to support domestic demand. "The focus of this year's tax code revisions is on strengthening the revenue base for fiscal sustainability, while supporting a leap forward as an economic power and stability of people's livelihoods," said Vice Finance Minister Lee Hyoung-il. The government's tax revenue fell for a second straight year in 2024, dropping by 7.5 trillion won to 336.5 trillion won, after declining 51.9 trillion won in 2023, amid an economic slowdown and tax cuts. Asia's fourth-largest economy grew in the second quarter at the fastest pace in more than a year on rebounding consumer spending and a surge in technology exports, but still faces headwinds from slowing global trade amid U.S. President Donald Trump's sweeping tariffs. The International Monetary Fund on Tuesday raised its outlook for most advanced and emerging economies this year based on developments around U.S. tariff negotiations, but South Korea was among the exceptions, with its 2025 growth forecast revised down to 0.8% from 1.0%. Thursday's proposal is expected to boost tax revenue by 2.6 trillion won in 2026 and 5.6 trillion won in 2027, according to the ministry. Taxes on corporate income will be raised by 1 percentage point, back to the 2022 level of 10-25%, from the current 9-24%. Taxes on stock transactions will also be increased back to the 2023 level of 0.2% from the current 0.15%, while the threshold constituting 'large shareholders' subject to capital gains taxes will be lowered to 1 billion won of stock holdings from the current 5 billion won. Dividend income, however, will be separately taxed from other financial income at lower rates, if it is from companies making high payouts, to make the domestic stock market more attractive. Low dividend payouts have often been cited as a factor behind the so-called "Korea discount" - the undervaluation of companies compared with global peers. Meanwhile, more artificial intelligence technologies will be designated as part of the country's "national strategic technologies" that are eligible for tax exemptions for investments. Tax cuts will also be introduced to boost investments in the cultural sector, such as "K-dramas". The government plans to submit the proposals to parliament, which is controlled by the ruling Democratic Party, by September 3. ($1 = 1,382.5200 won)
Reuters
a day ago
- Business
- Reuters
What we know about South Korea's trade deal with the US
SEOUL, July 31 (Reuters) - President Donald Trump said on Wednesday the U.S. would charge a 15% tariff on imports from South Korea as part of an agreement to avoid even higher levies. The deal includes a $350 billion investment in the U.S. by the Asian trade partner, but other non-tariff barriers, as well as security and foreign exchange issues, were left out. The deal reduces U.S. tariffs on South Korean autos from 25% to 15%, the same rate as on Japan and the European Union. Trump said South Korea would also accept American cars and trucks into its markets and impose no import duties on them. South Korea already imposes zero tariffs on manufactured goods under a free trade agreement, according to the finance ministry. Seoul said the countries would continue negotiations on safety regulations for U.S. imports of autos, a factor that Washington has cited as a non-tariff barrier. The United States agreed that South Korean firms would not be put at a disadvantage compared with other countries over upcoming tariffs on chips and pharmaceutical products, while retaining 50% tariffs on steel and aluminium. Trump said South Korea would invest $350 billion in the United States in projects "owned and controlled by the United States" and selected by Trump. South Korea said $150 billion has been earmarked for shipbuilding cooperation, while investments in chips, batteries, biotechnology and nuclear energy cooperation accounted for the remaining $200 billion fund. Loans and guarantees would account for a majority of the fund, while direct investments would represent a small portion, South Korean officials said, adding there were also "safeguards" such as purchase guarantees under the plan. Asked about fund details, South Korean presidential adviser Kim Yong-beom said the structures had not been specified and that "ambiguity is good". U.S. Commerce Secretary Howard Lutnick said 90% of profits would go to the American people, while Kim said he understood this as meaning "re-investment" in the U.S., not repatriated. Trump said South Korea would purchase $100 billion of liquefied natural gas or other energy products, which South Korea said would mean a slight shift in energy imports from the Middle East in the next four years. In relation to a $44 billion Alaska gas project pushed by Trump, South Korean officials have expressed caution, citing the feasibility of the project. Trump said South Korea would accept American farm products into its markets without duties. South Korea has already opened 99.7% of its market, with some 10 products left out as exceptions, such as politically sensitive rice, according to the presidential office. Kim said there was no agreement to open up the rice and beef markets. South Korea, the world's biggest buyer of U.S. beef, is set to lower tariffs to zero by 2026 under the free trade pact, but restricts imports derived from animals older than 30 months, citing concerns over mad cow disease. Still, the two countries agreed to continue negotiations over non-tariff barriers such as food safety control. South Korea's proposed legislation regulating online platform companies, which had been one of the most sensitive issues raised by the U.S. during working-level negotiations, was not addressed in the deal. The government has a number of legislative proposals to regulate tech companies at home and abroad, such as Google (GOOGL.O), opens new tab, Facebook (META.O), opens new tab and South Korea's Naver ( opens new tab and Kakao ( opens new tab, but the ruling Democratic Party put a brake on the enactment process to smooth negotiations with the U.S. Other non-tariff barriers cited in the U.S. foreign trade barriers report, such as restrictions on the export of location-based data, were not included in the deal either. Trump has complained that South Korea should pay more for some 28,500 U.S. troops stationed in the country, but officials said security matters were not discussed in these negotiations. Instead, they will be discussed at a summit between Trump and South Korean President Lee Jae Myung in coming weeks. At the opening round of trade negotiations in late April, South Korea agreed with the U.S. to consult on currency policy via a separate channel between finance officials. The matter has not been publicly brought up by either side since, but South Korean Finance Minister Koo Yun-cheol, accompanied by a foreign exchange official, is scheduled to meet U.S. Treasury Secretary Scott Bessent on Thursday.
Yahoo
2 days ago
- Business
- Yahoo
Indonesia to raise tax rate on crypto transactions
JAKARTA (Reuters) -Indonesia will raise taxes on cryptocurrency transactions, with a higher rate on trades hosted by overseas bourses, starting from August 1, according to a new finance ministry regulation. Cryptocurrencies have become a popular investment option in Southeast Asia's largest economy, where they are legally traded but cannot be used as a means of payment. The total transaction value of crypto assets tripled in 2024 from a year earlier to more than 650 trillion rupiah ($39.67 billion), regulator data showed. There were over 20 million users in crypto exchanges in the country in 2024, more than the number of investors in the stock market. Under the new regulation, sellers of crypto assets in domestic exchanges must pay a 0.21% tax on the transaction value, up from 0.1% previously, while sellers in overseas exchanges are charged 1%, from 0.2% previously. However, buyers would no longer be subject to a value added tax (VAT). Under previous rules, buyers would pay 0.11-0.22% VAT. Indonesia also raised the VAT rate on mining of crypto assets to 2.2%, from 1.1%. A 0.1% special income tax rate on crypto mining was removed, subjecting such income to either personal income tax or corporate tax rates, effective in 2026. Binance-backed Tokocrypto said it welcomed the changes, which reflect Indonesia's shift in categorising cryptocurrencies as financial assets and away from seeing them as commodities, but it proposed a grace period of at least a month to allow companies to adjust. "We also emphasize the importance of strengthening oversight and tax enforcement on crypto asset transactions conducted through foreign platforms," Tokocrypto said in a statement. The company called for fiscal incentives to bolster innovation in the industry, as the new crypto tax rate would still be higher than the capital gains tax rate used in stock market investments. ($1 = 16,385 rupiah)
Arab News
4 days ago
- Business
- Arab News
Pakistan finance minister due in US for ‘final' round of trade talks
KARACHI: Pakistan's finance minister, Muhammad Aurangzeb, has left for the United States (US) for a 'final' round of trade talks between the two countries, the Pakistani finance ministry said on Monday. Pakistan and the US have been engaged in talks after Washington announced a 29 percent 'reciprocal tariff' on Pakistani exports in April. Islamabad said the move, paused on April 9 for a 90-day period, may undercut its fragile, export-led recovery. The US is Pakistan's top export destination, with shipments totaling $5.44 billion in fiscal year 2023-2024, according to official data. From July 2024 to February 2025, exports rose 10 percent from a year earlier. The Pakistani finance ministry said the finalization of a trade agreement between Pakistan and the US will benefit both economies, noting opportunities for partnership between the two countries in various sectors. 'US is Pakistan's largest trading partner. Pakistan is keen to expand bilateral trade ties to traditional and non-traditional sectors,' it said. 'There are vast opportunities for partnership between the two countries in key sectors such as information technology, minerals and agriculture.' This is Aurangzeb's second visit to the US this month. The finance minister last week said that Islamabad and Washington were exploring a shift in their economic engagement, anchored in long-term investment. 'One thing we discussed was that we have to move beyond the immediate trade imperative for it to be brought into the next level and bring in a real step change,' he said, following his meeting with US Commerce Secretary Howard Lutnick and US Trade Representative Jamieson Greer in Washington. 'So, the investment imperative will come forward, and areas have already been identified in terms of minerals and mining, in terms of AI [artificial intelligence], in terms of digital infrastructure [and] crypto,' Aurangzeb said. 'We feel that this will be a real game changer, God willing, in terms of the relationship and the economic relationship between Pakistan and the United States.'
