According to Cointelegraph, Brazilian lawmakers are about to move to increase taxes on holders of cryptocurrencies held abroad.
If the bill is approved, Brazilian residents holding cryptocurrencies abroad will be subject to the same tax rules for traditional assets. In addition, the bill would tax any gains made from fluctuations in the price of cryptocurrencies against the Brazilian real.
Brazilian congressman Merlong Solano said they were seeking to promote equal treatment in taxes. In the previous regime, cryptocurrencies held abroad were taxed lower than those held in Brazilian exchanges.
Investors with overseas income of up to 6,000 reais (about $1,200) will be exempt from tax under the new rules, while those earning 6,000 to 50,000 reais (about $10,000) are subject to a 15% tax. Above this income threshold, the tax will be applied at 22.5%.
However, Solano emphasized that the changes only apply to cryptocurrency exchanges that do not have offices in Brazil. The legal expert said the new regulation could make crypto investors look to local Brazilian exchanges, especially those with profits above the highest tax bracket. Brazil’s National Assembly will vote on the bill on August 28. If approved, the new tax rate is expected to take effect in January 2024.
On August 7, the Central Bank of Brazil (BCB) announced renaming the central bank digital currency (CBDC ) to DREX (DLT). DREX was created to promote financial services, expand the access to capital of businesses. According to CHEAP EUTERS , after completing the pilot phase, DREX will go into operation by the end of 2024.
As of October 2022, Brazil’s oldest bank, Banco do Brasil, allows citizens to use digital currency to pay taxes. Brazil is considered the main cryptocurrency market among Latin American countries with 16 million crypto holders, accounting for 7.8% of the country’s total population. From January 2021 to November 2021, Brazilians traded $11.4 billion in stablecoins, which is three times the figure in 2020.