Brazil regulator goes after bitcoin to raise taxes

In a recent statement, the Receita Federal, Brazil’s main financial regulator, reported that starting in the first quarter of 2025, the tax conditions for profits obtained from operations with cryptoassets will be modified. The announcement was published on the official portal of the Brazilian government.

Thus, the regulator thanked to all those involved in a public consultation process that began in November 2024 and extended until December 20. The objective of this process was to evaluate suggestions for the implementation of new policies within the tax system. Right now 24 proposals are being evaluated.

The guidelines that the organization wishes to reform were implemented in 2019 under line IN RFB No. 1,888.

Interactions with the market have helped to develop adequate regulations that are understandable by all, avoiding fiscal risks. The suggestions received from 24 collaborators are being processed, and in the end, IN RFB No. 1,888, dated May 3, 2019, will be updated, which is expected to occur in the first quarter of 2025.

Communiqué from the Federal Revenue.

The entity also confirmed having organized several meetings focused on discussing the regulation, including during the public consultation period. As indicated, “the tax authorities have interacted with experts from other countries to establish adequate management, given the importance of this market.”

For now, The Federal Revenue has not specified how it will implement the changes to the current tax code. However, it has made it clear that it will carry out “inspections” and “enforcement actions” against those who do not comply with the rules. Although crypto taxation in Brazil has been relatively flexible since the laws were enacted in 2019, these statements indicate a shift in focus toward greater oversight, with the goal of prosecuting alleged tax evaders in the area of cryptoassets.

In August 2024, the Federal Revenue of Brazil organized a meeting between tax authorities and representatives of companies that operate with crypto assets in the country. The meeting, led by the Undersecretary of Taxation, Andrea Costa Chaves, aimed to highlight the importance of having clear regulations, which facilitates compliance with current tax regulations.

According to the Sherlock Communications survey, Brazil is positioned as one of the Latin American countries with the highest investment rate in crypto assets, reaching 24%. However, it faces significant challenges in understanding the ecosystem, with 42% of non-user Brazilians citing fear for the safety of their money as the main reason for not participating in the market.

Although in recent years Brazil was the leader in the adoption of cryptoassets in Latin America, in 2024 Argentina surpassed it as the country with the highest volume of cryptocurrency transactions in the region, according to data from Chainalysis.