Brazil’s tax authority is planning to gather information from foreign cryptocurrency exchanges to understand their operations in the country and ensure compliance with new tax laws. The Federal Revenue of Brazil is set to issue an ordinance requesting details from these firms later this week, as reported by Brazilian officials on June 18.
Andrea Chaves, Deputy Secretary of Inspection at the Federal Revenue, expressed concerns about potential illegal activities and the need to assess the operations of foreign exchanges in Brazil. Previously, only local cryptocurrency exchanges were required to report transactions on their platforms.
In December, Brazil implemented a law mandating a 15% income tax on profits and dividends from cryptocurrencies traded on foreign exchanges. The tax authority aims to collect approximately $4 billion in the 2024 financial year.
Major cryptocurrency exchanges in Brazil, such as Binance, Mercado Bitcoin, and Bitso, play a significant role in the market. Binance, holding the majority market share at 79%, faces competition from Mercado Bitcoin and Bitso in recent months.
Cryptocurrency trading activity in Brazil surged in the first few months of 2024, reaching $6 billion between January and May, a 30% increase compared to the previous year. According to a Kaiko report, Brazil is the largest market player in Latin America and the seventh-largest globally for fiat currency trade.
Stablecoin transfers continue to drive cryptocurrency activity in Brazil, highlighting the country’s growing interest in digital assets.