A major Brazilian bank is offering a new and convenient option for taxpayers to settle their dues using cryptocurrencies.
According to a statement published by Brazilian bank Banco do Brasil on Feb. 11, it is now “possible” for Brazilian taxpayers to pay their tax bill with crypto in a joint initiative with Brazilian-based crypto firm Bitfy.
It is available to Brazilians with crypto under the custody of Bitfy, which will act as a “collection partner” for the major Brazilian bank.
It noted that besides the convenience it brings to customers, it could “expand” the use and access to the digital asset ecosystem with “national coverage” while having the comfort of a reputable bank providing consumer protection.
Lucas Schoch, Bitfy’s founder and CEO, added that the “new digital economy is a catalyst for a future full of advantages.”
The statement said crypto users would experience a straightforward process, with the tax details displayed along with the amount of reals, the official currency of Brazil, that should be converted into the chosen cryptocurrency to pay the bill.
Taxpayers will access their tax bill by scanning a barcode, similar to how they pay a “boleto,” meaning ticket, a popular payment method in Brazil.
This move comes after the Brazilian city of Rio de Janeiro started accepting cryptocurrencies as payments for taxes in October 2022.
In December 2022, Brazil passed a regulatory framework that legalizes the use of cryptocurrencies as a payment method within the country.
The law will likely come into effect in June of this year.
Brazil’s citizens were previously told, in May 2022, that they would be required to pay taxes on like-kind crypto trades, for example, swapping Bitcoin for Ether.
However, not all crypto investors in Brazil need to declare their trades. The regulator establishes that only investors who trade more than 35,000 reals (around $6,711) in crypto should pay income tax.