The Department of Federal Revenue of Brasil (RFB) has strictly ordered all the digital currencies in Brazil are liable to present their monthly updates of financial performance. The update must also include the personal information of the dealers as well.
The reason for implementing such a measure, according to RFB, is that it wants to irradicate tax-related issues and to ward away looting of money. If this current obligation is taken into consideration, complying with the proposals would bring about transparency and reliability that have been anyway moving with a great speed. The explicit growth has been so much in the highlight that the count of the cryptocurrency owners surpassed the common stock owners of Sao Paulo-based B3 Stock Exchange.
The new draft prompts that the traders would no longer be able to trade without a proper disclosable identity. It is being postulated that the previous anonymous way of conducting the transactions gave way to the hackers to invade and loot easily. The spammers, criminals and tax dodgers would simply disguise themselves as another transactor in the guise of anonymity to fulfil their purpose.
However, it is to be noted that not all Brazilian residents and companies are required to submit the report to RFB. Only the traders with transactions of more than 10,000 reals ($2,700 approximately) done on an exchange of the foreign cryptocurrencies are accountable.
On failing to submit before or on the due date of submission of the expected report, a trader is expected to pay a fine of $400 and a three per cent of the total revenue is liable to be deducted on finding out nooks or breach of any kind in the report.
Brazil trades with Latin American Country which saw an upsurge of $12.1 million in 2014 to $2.24 billion as reported at the end of the year. RFB expects the trade volume to go up by 12.15 billion by the end of this year alone, the current volume being $4.86 billion. RFB explains:
“The numbers and their annual growth demonstrate the relevance of the cryptocurrency market in Brazil, especially for the tax administration, since these transactions are subject to income tax on capital gains. The search for anonymity, which is one of the main attractions for the use of certain cryptocurrencies, must always be fought, including by the tax authority.”
The order by RFB coincides with the recent court ruling concerning Banco do Brasil and Banco Santander who have been urged to reopen the digital exchanges Bitcoin Max’s bank account which was brought down without any prior notice.
This also brings in the question of centralizing of cryptocurrency assets as many nations are accepting cryptocurrency but with proper regulatory bodies in charge.