Provisional measure should bring a fixed rate of 17.5% also on cryptocurrency gains, which today ranges from 15% to 22.5%, but IOF collection on stablecoins operations depends on BC’s endorsement, according to Folha de S.Paulo
The Ministry of Finance should also include cryptocurrencies in the Provisional Measure (MP) that aims to change the taxation of financial investments, with a standard rate of 17.5%, but is still awaiting definition of the Central Bank, sector regulator, to implement the possible application of tax on financial operations (IOF) on transactions that characterize exchange rates. The information is from the newspaper S.Paulo Folha.
The application of IOF to transactions with and other virtual currencies will continue open until the Central Bank concludes debates of the public consultation aimed at the exchange market. According to the newspaper, the proposal was even pointed out in an internal presentation of Minister Fernando Haddad during a meeting with the Congress summit on Sunday (8), but has not yet been included in official suggestions.
The government shows fear that stablecoins, which are cryptocurrencies indexed to ordinary currencies, such as the dollar, are used for fiscal dropout. Unlike common sense, the cryptocurrency Tether (USDT) is the busiest cryptocurrency in Brazil, not the most famous Bitcoin (BTC), according to IRS data.
Currently, experts point out that the BC already recommends the collection of IOF in transactions with stablecoins that fit as a exchange rate operations, but there is the understanding within the government that more clarity is needed in relation to triggers for this collection.
With the change, taxation on cryptors could undergo the following changes:
- Gain from cryptocurrencies: passes from rates between 15% and 22.5% to 17.5% fixed, along with other investments. Today, revenue already taxes cryptocurrencies as financial investments. It is not yet known if the current exemption range of $ 35,000 for monthly profits will be maintained
- IOF on stablecoins, cryptocurrency indexed to coins such as the dollar: possibility under study, but will only be applied after technical definition aligned with the Central Bank. The justification is to prevent the market from migrating abroad.
IOF RETTION ON VGBL
Still according to S.Paulo Folhathe government will also change the IOF collection limit on VGBL plans contributions. The trigger would rise from $ 50,000 to $ 600,000 per month, and the tax would only focus on the amount that exceeds this level. The change, which is expected to join a new decree again reviewing IOF, would also include a transition rule by December 31, 2025.
