The government of Brazil is advancing legislation that will increase taxes on cryptocurrency kept abroad.

Local news sources claim that a legislative committee has accepted changes to a measure that would classify cryptocurrencies as "financial assets" for the purposes of taxation when used in international investments.

The proposed legislation also levies taxes on gains resulting from changes in the value of crypto assets relative to Brazilian real, as well as changes in exchange rates.

Since crypto investments made abroad now receive less favorable tax treatment, the modification aims to encourage equal tax treatment, according to Deputy Merlong Solano.

The law states that only bitcoin exchanges without offices in Brazil will be affected by the amendments. According to legal experts, the new regulations may make local exchanges a more affordable choice for some investors, especially those with gains above the top tax level.

Additionally, the regulation may encourage foreign companies to open offices in the nation and increase activity on crypto exchanges nationwide.

The bill will be put to a vote on August 28 in Brazil's National Congress. The increased taxes would go into effect in January 2024 if they were approved.

Sources:

https://cointelegraph.com/news/brazil-moves-levy-higher-taxes-cryptocurrencies

https://thepaypers.com/cryptocurrencies/brazils-congress-moves-towards-imposing-higher-cryptocurrency-taxes--1263869

https://finbold.com/brazil-lawmakers-seek-to-increase-taxes-on-cryptocurrencies-held-overseas/

https://exame.com/future-of-money/comissao-aprova-mudar-cobranca-imposto-criptoativos/