Brazil to introduce a tax on crypto income from foreign exchanges
Brazil to introduce a tax on crypto income from foreign exchanges
Brazil is preparing to impose a 15 percent tax on cryptocurrency income from exchanges outside the country.
On November 29, Brazil's Federal Senate approved the bill, and it is expected to be signed into law by President Luiz Inácio Lula da Silva.
The tax will apply to Brazilians who earn more than $1,200 (6,000 Brazilian reais) in foreign currency starting January 1, 2024, Cointelegraph reported. Meanwhile, funds earned before that date will be taxed at a lower rate of 8% when accessed by the owner.
The bill also affects single-shareholder investment funds and foreign companies operating in the Brazilian financial market.
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The Brazilian government hopes to raise $4 billion from the new tax.
Senator Rogerio Marinho expressed his opposition to the bill, saying, "The government is imposing the tax because it is a bad manager.
The move comes after the head of Banco Central do Brazil announced plans in September to tighten the regulation of cryptocurrencies due to their high popularity in Brazil. Campos Neto, governor of the Banco Central do Brazil, then justified his opinion with the fact that cryptocurrency allows tax evasion.
Recall that in June, Brazil's central bank extended its jurisdiction to virtual asset service providers.
Cryptocurrency securities in Brazil are regulated by the Comissao de Valores Mobiliários, an analog of the U.S. Securities and Exchange Commission.
A number of leading financial experts have already said that the innovation will reduce the tax attractiveness of Brazil.
Read also: US intends to intensify efforts to combat illegal crypto transactions.
