Brazil has canceled long-term tax exemptions on cryptocurrency earnings and has taken new temporary measures (MP 1303), a tax of 17.5% on all individuals’ cryptocurrency profits.
Previously, individuals sold up to Rs 35,000 (approximately US$6,300) of cryptocurrencies were tax-free every month. Prior to the change, the gradual taxation benefits were as high as 22.5%, exceeding $5.4 million.
The new rules replace the system with a unified tax, meaning smaller investors will face higher tax burdens, while large holders may see their bills shrink, local news media Do Bitcoin on the portal Report.
Taxes will apply regardless of where the assets are held, including in wallets of overseas communication or self-guarding. Losses can be offset, but only within the fifth of the rolling window, this rule will become more stringent from 2026.
The government said the overhaul aims to increase taxes after withdrawing the proposed financial transaction tax, which has attracted criticism from industry and Congress.
In addition to cryptocurrencies, the new measures will also affect fixed income investments and online betting, while the former now imposes a fixed tax of 5% on revenue, while the latter sees a tax rate on operator revenue rise from 12% to 18%.
