Brazilian Department of Federal Revenue releases draft on crypto taxation
According to the draft of the regulation, The Department of Federal Revenue of Brazil (RFB) that oversees tax collection in the country is now seeking to receive monthly reports on crypto assets and operations.
There are several new guidelines the regulators are trying to impose, below are just a few of them:
- All crypto exchanges based in Brazil will be obliged to send monthly detailed reports on all crypto-related operations.
- All companies dealing with crypto will have to reveal the amounts of transactions, as well as the identity of the customers.
- Both legal entities and individuals residing in Brazil will be obliged to report all the transactions they have carried at foreign crypto exchanges, if they surpass $10,000 Brazilian reals ($2,700) per calendar month.
- Those who fail to report crypto assets or transactions will be charged up to 1,500 Brazilian reals in penalties and fees ($400).
- In case the submitted documents are insufficient or false, the fine will go higher, up to 3 percent of transaction value.
The draft is currently open for the public to contribute – the tax watchdog will accept proposed adjustments till November 19th. According to the explanatory note published by the department, such extensive measures had to be taken due to the unprecedented growth in the industry. As of today, the number of crypto exchange clients has already exceeded the number of users registered at the Brazilian stock exchange in San Paolo, B3, while the daily volume of transactions conducted by five major Brazilian crypto exchanges surpasses 8.3 million reals, which equals around $2.2 million.
With the crypto rising in value, state governments across the globe move to its regulation. A similar taxation proposal has been introduced by the Council of Ministers of Spain just a few days before the Brazilian Department of Federal Revenue made the announcement.