Brazil’s federal revenue agency has released new rules for crypto trading platforms. Under the new guidelines, crypto exchanges are required to report on all crypto transactions carried out within their system.
The new rules were released by the Department of Federal Revenue of Brazil (RFB) and will affect the way cryptocurrency exchanges inform the regulator about users’ transactions in order to identify tax fraud. Brazil is not the first country to pursue taxation of crypto assets but is the first one to announce actual regulations to go into effect.
Cryptocurrency trading platforms that wish to remain operational in Brazil will have to adopt new rules to report about the movements of users’ crypto funds to the agency, and comply with the requirements of Normative Instruction 1.888/2019 published in May of this year.
Specific requirements of the government agency stipulate that cryptocurrency exchanges operators based in Brazil should provide information about all transactions carried out within their system. At the same time, platforms based abroad must provide information “whenever the monthly value of the operations, alone or jointly, exceed 30,000.00 Brazilian reals [$7,750].”
In addition to the volume of a transaction, exchange operators will also be obligated to provide data such as the nationality of the digital currency holder, their residence or domicile, registration number and the crypto assets used in a transaction.
According to the rules, there will be a certain time period within which all required information must be provided, “until 23:59:59, Brasilia time, on the last calendar month subsequent to that in which the operation took place.” The new rules are expected to come into force in September 2019.
Ismair Junior Couto, legal director of the Bitcoin Banco Group — Brazil’s largest cryptocurrency broker — commented that the RFB’s announcement on the new requirements for cryptocurrency exchanges had long been expected. He added that Bitcoin Banco had made provisions to provide the required information to authorities.
On May 31, Cointelegraph Brazil reported that the President of the Chamber of Deputies of Brazil ordered the creation of a new commission to oversee cryptocurrency regulation in the country. The commission will be tasked with regulating local activities around Bitcoin (BTC) and other digital assets, and is reportedly expected to be composed of 34 members in accordance with the House Rules of Procedure.