Brazil’s Proposed Crypto Tax: Winners, Losers, and the End of an Era for Retail Investors

Brazil’s Congress is currently debating a provisional measure that could potentially transform crypto taxation in the country—and not necessarily for the better. If passed, the reform would place a flat 17.5% tax on all crypto gains, however large or small.

According to Fabio Plein, Coinbase’s Regional Director for the Americas, the proposed measure would represent a significant setback for retail and small-scale investors. Meanwhile, high-net-worth individuals stand to gain. 

In June, Brazil’s federal government enacted Provisional Measure 1303/25 to simplify the tax treatment of various financial instruments, including cryptocurrencies. 

This new provisional measure allows the Brazilian government to replace its current progressive crypto tax system with a flat 17.5% rate. This change temporarily abolishes the previous tiered structure, taxing gains at 15% to 22.5% depending on size.

In addition, the measure erases the existing exemption for all crypto transactions worth under R$35,000, or roughly $6,500. It also standardizes the tax treatment of crypto assets, regardless of where they are held. The flat rate applies equally to self-custody wallets and offshore accounts.

I don’t know who needs to hear this, but governments are coming for your crypto gains.