Flat 17.5% Rate Replaces Exemptions

New Brazil crypto tax 2025

On June 12, 2025, Brazil introduced a sweeping new cryptocurrency tax law under Provisional Measure 1303. 

It replaces the old progressive tax model with a flat 17.5% crypto tax on all capital gains — no matter how much is earned or where the assets are held. The policy ends the long-standing exemption that allowed individuals to sell up to 35,000 Brazilian reais (~$6,300) in crypto each month tax-free.

This new Brazil crypto tax 2025 applies across the board — whether your assets are held on local or offshore exchanges, in self-custody wallets or even across decentralized finance (DeFi), non-fungible tokens (NFTs) or staking platforms. 

All digital asset activities now fall within scope. Tax calculations are made quarterly, and losses can be carried over for up to five previous quarters — a window that will be shortened in 2026.

Did you know? Brazil’s overall tax burden reached 32.32% of GDP in 2024, the highest in 15 years, creating strong fiscal motivation behind the comprehensive Brazil tax reform 2025, including the new crypto tax policy.

Previous crypto tax rules in Brazil

Until now, crypto capital gains in Brazil were taxed under a tiered regime. 

Small trades enjoyed a generous exemption, and larger profits were taxed progressively:

• Trades up to 35,000 reais/month were exempt from crypto tax — ideal for small investors and casual traders.
• Once that threshold was crossed, the following brackets applied:
  • 15% tax on gains up to 5 million reais
  • Up to 22.5% for gains exceeding 30 million reais (~$5.4 million).

This meant hobbyists typically paid nothing, medium-scale traders paid moderately, and only the largest investors faced top-tier taxation.

Crypto tax impact small investors — Crypto tax exemption scrapped

The most immediate consequence of the new crypto tax rules in Brazil is felt by everyday users. Casual traders who previously stayed below the 35,000-real monthly cap are now fully taxed at 17.5%. For example, a modest 30,000-real profit — previously tax-free — now incurs a 5,250-real liability.

This flat-rate model hits small investors and gig-economy traders hardest. The ease and simplicity of the exemption are gone, replaced by full liability, even for low-frequency users.

Impact on medium and large investors: New crypto tax policy Brazil

Under the prior regime, medium-scale investors paid a manageable 15% on gains under 5 million reais. They now face a 17.5% tax.

However, for high-net-worth traders, the new system can actually reduce the tax burden. Previously, gains over 30 million reais were taxed at 22.5%. Now, that’s capped at 17.5%, leading to significant savings on large positions. For some, this reform is a windfall.

Did you know? In the first nine months of 2024, Brazil’s net crypto imports surged over 60% year‑on‑year, already surpassing 2023’s full-year volume, demonstrating rapidly growing demand and capital flow into the crypto ecosystem.

Brazil’s 2025 tax reform expands to crypto, DeFi, NFTs and offshore assets

Brazil’s cryptocurrency tax law forms part of a wider Brazilian tax reform 2025 that expands the tax base across both traditional and digital assets.

Offshore and self-custodied crypto

The 17.5% flat tax now also applies to digital assets held outside of centralized Brazilian exchanges — whether in offshore accounts or self-custody wallets. This closes a major loophole that once allowed avoidance through foreign platforms or cold storage.

DeFi, NFTs and crypto staking

The law explicitly includes new sectors like DeFi lending, staking rewards and NFT trades. Returns from yield farming or NFT sales are now taxed like any other crypto gain. These once-gray areas are now fully regulated.

Traditional finance: Fixed-income and betting

Provisional Measure 1303 also introduces:

• A new 5% tax on fixed-income investments like LCIs, LCAs, CRIs, CRAs and other formerly tax-incentivized bonds.
• Higher rates for the betting industry: Brazil’s online betting tax will jump from 12% to 18% on gross gaming revenue starting October 2025.

How Brazil compares to other countries on crypto taxes

Brazil’s flat 17.5% crypto tax under MP 1303 places it in the middle of the global spectrum — stricter than tax havens but far more lenient than countries with punitive rates. 

International crypto tax landscape

In India, crypto capital gains face a steep 30% flat tax, coupled with a 1% tax deducted at source (TDS) and no option to offset losses, making it one of the harshest regimes in the world. 

Japan’s crypto tax system is equally aggressive: Profits are classified as miscellaneous income, with rates climbing to 55% depending on the investor’s overall income.

At the other end of the spectrum, countries like the United Arab Emirates, Switzerland and El Salvador offer 0% capital gains tax on personal crypto holdings. These zero-tax jurisdictions are magnets for high-volume traders and crypto startups, but Brazil has opted for a middle path — still taxing but without suffocating the market.

In this light, Brazil’s cryptocurrency tax law looks more balanced. It captures revenue while staying competitive globally, especially when compared with the international crypto tax extremes.

Did you know? A prominent Brazilian member of Parliament has already proposed exempting long-term Bitcoin holders from crypto capital gains tax, recognizing BTC as a strategic store of value, signaling early legislative resistance to MP 1303.

Why the new crypto tax policy, Brazil?

The introduction of MP 1303 is a strong move in Brazil’s fiscal strategy. 

Previously, the government experimented with raising the IOF tax, a financial operations levy that briefly increased on credit and FX transactions. The hikes sparked backlash from markets and regulators, prompting a retreat.

Rather than continuing with piecemeal tax hikes, Brazil has now opted for structural change. The move to tax digital assets, fixed-income investments and online betting revenues reflects a wider Brazilian tax reform in 2025, aimed at broadening the tax base with more permanent and enforceable policies.

What’s next for crypto taxation in Brazil?

From tighter enforcement to payroll innovation, here’s what investors, companies and regulators should expect next from Brazil. 

1. Stricter reporting and onchain monitoring

The Receita Federal is preparing to expand its oversight, especially on offshore accounts and self-custodied wallets. Expect enhanced data matching between declarations and onchain activity, particularly as Brazil begins to collaborate more closely with international tax bodies.

2. Loss-carryover window narrows in 2026

Currently, investors can deduct losses across five previous quarters — a provision designed to smooth volatility. But, starting in 2026, this crypto tax loss carryover period will shrink, pressuring small investors to harvest losses in 2025 for maximum benefit.

3. Crypto payroll: Salaries in digital assets

Legislation under review could allow Brazilian companies to pay up to 50% of employee salaries in crypto. Foreign contractors and freelancers may even receive 100% of compensation in digital assets, provided payments are routed through approved exchanges for conversion at official rates. This opens the door for crypto to move from an investment vehicle to a wage standard, at least for some.

4. Fintechs embrace Bitcoin as treasury reserve

Even with new taxes, crypto adoption at the corporate level continues. Brazilian fintech Méliuz, for example, raised 180 million reais (~$32 million) in mid-2025 and has become one of Latin America’s largest public holders of Bitcoin (BTC), now holding nearly 600 BTC. This mirrors global trends where private firms are using Bitcoin as a strategic hedge despite rising crypto tax burdens.