To request information from the Brazilian Tax Department on foreign crypto exchanges: Report
Brazil's tax authorities are reportedly planning to seek information from foreign cryptocurrency exchanges to determine how they operate in the country and whether their citizens are following the country's new tax laws.
Recita Federal do Brasil (Brazilian Federal Revenue) is expected to publish a decree later this week calling for more information from these companies, according to a June 18 Reuters report, citing comments from Brazilian officials.
“Our first concern is to understand how they operate here, whether there is illegality or not,” Andrea Chaves, deputy secretary general of the DFR's inspector general, told Reuters.
“We are also concerned about access to tax-related information about Brazilian wealth.”
As of now, local cryptocurrency exchanges are obligated to report transactions on their trading platforms.
Last December, Brazil passed a law requiring Brazilians to pay a 15 percent income tax on cryptocurrency profits and foreign currency gains.
Brazil's tax authority aims to collect about $4 billion (20 billion Brazilian reals) in the 2024 fiscal year.
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Binance, Coinbase, OKX and KuCoin are among the popular trading platforms operating in the country. Binance currently holds the largest market share in Brazil, accounting for 79% of all transactions – although it has lost dominance to Brazil's Mercado Bitcoin and Mexico-based Bitso in recent months.
Meanwhile, Brazil saw significant growth in cryptocurrency trading activity in the first few months of 2024, with a 30% year-on-year increase of $6 billion between January and May.
A recent Caico report confirmed that it is the largest market player in Latin America and the seventh largest fiat currency trading worldwide.
Stablecoin transfers remain the main source of cryptocurrency activity in Brazil.
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