Starting June 12, Brazil will enforce new cryptocurrency taxation rules, introducing a flat tax rate on profits.
New Cryptocurrency Tax
With the introduction of Provisional Measure 1303, Brazil applies a 17.5% tax on all cryptocurrency transactions, regardless of their volume or value. This measure is aimed at increasing revenue from financial market activities.
Changes in Taxation
Under the new regulations, taxation applies to crypto assets held in self-custody wallets and digital assets stored overseas. Investors are now required to declare all gains quarterly, with the ability to offset losses from the previous five quarters. However, this offset period will be reduced starting in 2026.
The Future of Cryptocurrency in Brazil
Brazil, already the largest cryptocurrency market in Latin America, is also considering laws that allow salaries to be paid in cryptocurrency and the establishment of a strategic Bitcoin reserve. This potential implementation would make Brazil the first G20 nation to formalize Bitcoin as a reserve asset through legislative channels.
The changes in taxation and cryptocurrency legislation in Brazil mark a significant step towards integrating digital assets into the country's financial system.
