Brazil?s New 17.5% Crypto Tax: What Investors Need to KnowBrazil has moved to overhaul how it taxes digital assets. A Provisional Measure (MP 1303) issued by the government introduces a flat 17.5% income-tax rate on financial investments and crypto assets, replacing the prior bracket system and eliminating the long-standing tax exemption for crypto sales up to R$35,000 per month. The measure is part of a wider fiscal package and takes effect provisionally pending congressional approval.
What?s actually changing
Flat 17.5% rate. The measure unifies the rate on investment income and capital gains?including digital assets?at 17.5%, replacing the 15%?22.5% scale that depended on holding period and size of gain. Reuters and the government?s own summary highlight the shift to a single rate across asset classes.
No more R$35,000 monthly exemption. Crypto gains that were previously exempt when monthly sales stayed at or below R$35,000 are now taxable at 17.5%. The Senate?s explainer explicitly notes the end of this relief for crypto.
Scope covers offshore and self-custodied assets. The government?s text and legal analyses place crypto assetsinside the unified investment framework?regardless of whether they?re held on a local exchange, overseas, or in self-custody.
Timing and implementation. As a Provisional Measure, MP 1303 has immediate effect but must be converted into law by Congress to remain in force. EY?s technical alert notes that withholding mechanics for financial investments are slated from 1 January 2026, so taxpayers should watch for transitional rules and the final legislative text.
Why Brazil is doing this now
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