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The Federal Revenue Service of Brazil (RFB) issued a proposal for a new normative instruction that regulates the market for cryptocurrencies, such as bitcoins. The
proposed normative instruction provides for another ancillary obligation (i) for Brazilian resident legal entities qualified as cryptocurrency exchanges and (ii) for Brazilian resident individuals and legal entities that carry out transactions with cryptocurrencies, whether or not those are conducted on cryptocurrency exchange platforms.
According to the new proposed normative instruction, those who conduct transactions with cryptocurrencies must report the name, the nationality, the tax residence, and the current address of the parties to each transaction. Additionally, they must report their Brazilian Individual Taxpayer ID Number (CPF), or their Corporate Taxpayer ID Number (CNPJ), or their Taxpayer Identification Number (NIF) abroad, when applicable, plus any residual information RFB requests in its file.
A more sensible information request in the proposed normative instruction is directed to domestic cryptocurrency exchanges, relating to the balance of currency and cryptocurrencies, as well as to their market value, if available.
The fines established by Article 9(II) include a 3% charge on the total amount of unreported transaction, or those reported with any deficiency or error.
The RFB is accepting comments on the proposed normative instruction from October 31, 2018, until November 19, 2018.