Starting from August 1 Brazil Citizens required to submit a complete report of their crypto transactions with the country's tax authority, the Department of Federal Revenue (RFB).
Authorities in Brazil have to report all Crypto Transactions
According to the report shared by Cointelegraph Brazil, transactions consisting of cryptocurrencies like Bitcoin (BTC) have to be reported to the RFB in agreement with the rules built by the Normative Instruction 1,888 released in May 2019.
As per the report shared by national public news agency Agência Brasil, the latest rules apply to individuals, firms, and brokerages, and consists of all types of crypto-related activities, along with buying and selling, and donations, barters, deposits, withdrawals, and others.
The latest measure needs entities to offer monthly reports by the end of the month following the month when crypto-related transactions occurred, the report says. For instance, the information for the month of August should be given until the last business day of September.
As per the rules, local crypto exchanges will have to report RFB regarding the operations irrespective of their value. But, all the users who use the Foreign crypto exchanges or brokerages, or carry out peer-to-peer transactions in crypto, and will have to report on the transactions if the monthly amount reaches over 30,000 Brazilian reais.
Penalties range between 1.5% to 3% of the amount of Unreported Transaction
Users who fail to submit their report on their crypto transactions will be penalized between 100 to 500 Brazil reais or from $25 to $130. The RFB also has the right to charge from 1.5% to 3% of the amount of unreported transaction as a penalty, as per Agência Brasil.
As per RGB's point of view, the digital currency market in Brazil has more investors as compared to Brazil's second oldest stock exchange, B3, that reportedly has around 8,00,000 customers. By implementing the above rule, the authority wants to fight against illicit activities such as money laundering, tax evasion, and terrorist financing, the report says.