Brazil Establishes Single Tax on Cryptocurrency Income
Date: 2025-06-17 Author: Henry Casey Categories: IN WORLD
A new procedure for taxing income from digital asset transactions came into effect in Brazil on June 12, 2025. Now, all cryptocurrency owners are required to pay a tax of 17.5% of their profits, regardless of their volume. Previously, investors whose monthly income from crypto transactions did not exceed R$35,000, which is equivalent to approximately $6,300, were exempt from paying taxes.
This innovation will affect a wide range of market participants: from those involved in staking to traders actively working with Bitcoin and other cryptocurrencies. According to Rafael Santi, Executive Director of the Brazilian Association of Cryptocurrency and Blockchain (ABCB), such a decision could negatively affect the position of local crypto platforms and the pace of development of the industry in the country. He believes that the increase in the tax burden will lead to a decrease in income for most small and medium-sized investors, which, in turn, pushes them to move to foreign exchanges that are not under the control of the Brazilian authorities.
Santi emphasized that crypto market participants will now have to reconsider their financial strategies. Those who previously counted on high returns from transactions with digital assets will have to take the new tax into account in their calculations. This can significantly reduce the profitability of operations. At the same time, according to the head of ABCB, the presence of a fixed tax rate simplifies the calculation process for both businesses and tax authorities. This, in turn, creates conditions for the legalization of crypto activities of large companies, for which not only the tax rate is important, but also the transparency and predictability of the system.
It is worth noting that the Supreme Court of Brazil recently approved the right of general jurisdiction courts to confiscate traders' digital assets in order to pay off debts to creditors. This step became part of a broader policy to strengthen control over the digital finance sector and regulate the activities of its participants.
Thus, the measures taken by the government are aimed at formalizing and more strictly controlling the cryptocurrency market in the country, which is already causing concern among investors and experts.
