Brazil is considering imposing taxes on cryptocurrencies to mitigate the impact of increased financial transaction taxes.
Powered by ChatGPTChainCatcher reports that according to Bitcoin.com, the Brazilian government is considering taxing cryptocurrency transactions to mitigate the social impact caused by the increase in the Financial Operations Tax (IOF).
After the government announced the IOF tax rate hike on May 22, House Speaker Hugo Motta proposed including cryptocurrencies within the tax scope during a public speech but emphasized that the proposal has not been finalized.
This proposal has sparked controversy within Brazil's crypto industry. Vanessa Butalla, Vice President of Legal Affairs at Mercado Bitcoin, pointed out that under current regulations from the Brazilian tax authority, imposing IOF on cryptocurrencies is akin to taxing investment real estate and lacks legal basis.
Daniel de Paiva Gomes, partner at Paiva Gomes Law Firm, further stressed that only legislative action by Congress can classify cryptocurrencies as taxable assets; the government only has the authority to adjust tax rates and durations.