Brazil Crypto eliminates tax brakes, 17.5% flat rate

Brazil has abolished its tax exemption for small scale crypto profits, introducing 17.5% flat rate on all capital gains from digital assets. The new rule was announced under provisional measure 1303 as part of the government’s push to increase revenue through financial market taxation.

So far, residents of Brazil who had sold 35,000 Brazilian (about $ 6,300) in Crypto assets per month were exempted from income tax. Beyond this, the profit was progressively taxed, starting from 15% and 30 million Brazilians reached 22.5% for real versions above real.

The new flat rate, which begins on 12 June, removes all discounts and applies equally to all investors, regardless of their transactions, regardless of their transactions, According Local news outlets do bitcoins for a report in the portal.

While small investors will now have to face high tax burden, people with high-pure-values ​​can pay less. Under the previous system, large trades, which were more than 5 million Brazil’s real, were taxed between 17.5% and 22.5%. Under the influence of a similar 17.5% rate, many large investors will see a decline in their effective tax rate.

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Brazil targeted self-costi and offshore crypto

Provided measures also expand the base. Crypto property organized in self-custody wallet and foreign crypto holdings is now involved in tax rule.

According to the report, taxation will be evaluated quarterly, investors allowed the loss to damage from the last five quarters. However, since 2026, the window will be tightened for loss cuts.

The overhaul is spread beyond crypto. Fixed income instruments, once exemption from income tax, such as Agribesiness and Real Estate Credit Letters (LCAS and LCIS), as well as real estate and aggregation will be taxed 5% on profits.

Meanwhile, taxation on betting revenue has increased from 12% to 18%.

The Finance Ministry introduced these changes after the backlash in the earlier attempt to increase the financial transactions (IOF). The proposal was given shelter after facing strong opposition from both the market and the Congress.

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Brazil Bitcoin allows salary payment

In March, Brazilian MPs made a proposal that would allow employers to partially pay in cryptocurrency like bitcoin (BTC). Under the proposed rules, crypto payment may not exceed 50% of an employee’s salary.

Full crypto payment will be allowed only for foreign workers or contractors and only under specific terms set by the central bank of Brazil. The bill prohibits paying wages in digital assets for standard employees.