Brazil - Changes in Cryptocurrency Taxation

Brazil is preparing to introduce a new cryptocurrency taxation scheme proposed in a bill to be presented in the coming days before the National Congress. The bill proposes taxing cryptocurrencies in a similar manner to stocks and capital instruments with variable exchange rates, rather than treating them as goods.

According to the proposed changes, cryptocurrency investors will be required to pay a 15% tax on income from transactions conducted using cryptocurrencies. Currently, profits from cryptocurrencies are taxed as goods and are subject to capital gains tax depending on transaction volumes.

The new tax system will also include NFT tokens and will apply to investors who conduct transactions totaling over 35,000 reais (approximately $7,000) monthly on all platforms where they are registered.

However, it is uncertain whether the new bill proposal will change the current tax thresholds, potentially exempting cryptocurrency investors from paying taxes on trading small amounts of cryptocurrencies.

The changes proposed in the bill are expected to take effect in 2025, but it is necessary for Congress to pass the bill, which has been in development for over a year.

The new tax system is part of increased oversight that the Brazilian government is imposing on cryptocurrencies. In February, the Brazilian tax authority for cryptocurrencies detected irregularities in over 25,000 cryptocurrency tax declarations, combining traditional and artificial intelligence techniques to identify these issues.

*this is not a financial advice