Brazilian Tax Agency strengthens virtual currency reporting rules for foreign exchange and DeFi

The Brazilian Federal Revenue Agency has revised its rules regarding the tax reporting of crypto assets. The new rules will require foreign exchanges to report transactions to authorities and require disclosure of DeFi operations.

Brazil’s new tax system targets foreign exchange and DeFi activities

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The Brazilian Tax Agency (Federal Receita) has announced new regulations that introduce additional requirements for both companies and individuals, with the aim of strengthening tax collection from tax evaders.

The new rules stipulate that all exchanges, both foreign and domestic, must report the cryptocurrency operations of their Brazilian customers to authorities.

Similarly, individuals will be required to report operations totaling nearly $6,560 each month, including those completed using centralized exchanges and those performed on decentralized finance exchanges, including airdrops, staking, and other similar activities.

Inspector General Andrea Costa Chavez told Barrow Economico that these new rules are “consistent with international reporting standards” set by the Organization for Economic Co-operation and Development (OECD). In this sense, she said that from 2027, the exchange of this tax data will be possible with companies subscribed to these standards.

Mr. Chávez stressed that these rules are aimed only at curbing tax evasion and have no other purpose. “This is not about data collection, this is about making sure no one takes their eyes off financial commitments,” she argued.

read more: Brazil issues new crypto regulations, tightens controls on stablecoin transactions and VASPs

Why is it relevant?

The new rules could hurt Brazil’s crypto industry as they increase compliance burdens on both domestic and foreign exchanges, prompting domestic users to seek decentralized alternatives that are less easily traced.

It is still unclear how the agency will monitor decentralized finance (DeFi) platforms to check the activities of Brazilian citizens. Nevertheless, the Brazilian Crypto Economy Association (ABcripto) emphasized that these changes require special attention from cryptocurrency operators to adapt to the new compliance requirements.

The Brazilian Association for Tokenization and Digital Assets (ABToken) said that including foreign exchange in the ruleset could be problematic. “This extraterritorial projection tends to create legal uncertainty,” it declared.

I’m looking forward to it

Brazil’s entire crypto industry is currently preparing for regulatory changes that are still unclear, including stablecoin rules that could be repealed by the Brazilian Congress in the future.

Still, if enacted as is, these rules will impact adoption levels in Brazil and transform the cryptocurrency ecosystem in one of Latin America’s largest economies.

FAQ

• What new rules has the Brazilian Tax Authority introduced for virtual currencies?
  Brazil’s National Tax Agency now requires both companies and individuals to report cryptocurrency operations, and is stepping up its collection efforts against tax evaders.

• What reporting requirements are in place for individuals?
  Individuals are required to report cryptocurrency transactions that add up to approximately the gross amount. $6,560 per monthincluding those from centralized and decentralized exchanges.

• How do these new rules align with international standards?
  Regulations are designed to meet: OECD reporting standardsand starting in 2027, Brazil will exchange tax data with compliant companies.

• How might these regulations impact Brazil’s crypto industry?
  The increased compliance burden could drive local users towards decentralized alternatives and create legal uncertainty for foreign exchanges operating in Brazil.