On June 12, 2025, Brazil enacted a significant cryptocurrency tax law through Provisional Measure 1303, establishing a flat 17.5% tax on all capital gains, eliminating the previous exemption for monthly crypto sales under 35,000 Brazilian reais (~$6,300). This law applies universally, affecting assets on local and offshore exchanges, self-custody wallets, and decentralized finance platforms. Tax calculations will occur quarterly, with losses eligible for carryover for five quarters, though this will shorten in 2026. The reform aims to address Brazil's rising tax burden, which reached 32.32% of GDP in 2024. While small traders now face full taxation, high-net-worth individuals may benefit from reduced rates on large gains. The law also encompasses new sectors like DeFi and NFTs, closing loopholes for tax avoidance. Brazil's tax regime is more balanced compared to harsher systems in countries like India and Japan, positioning it competitively in the global market. Future legislation may allow crypto salary payments, indicating a shift towards broader crypto adoption. Read more AI-generated news on: https://app.chaingpt.org/news

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