Brazilian taxpayers can quickly repay their tax debt thanks to the action, which will also increase “access” to the ecosystem of digital assets. A significant Brazilian bank is providing taxpayers with a fresh and practical way to pay their taxes using digital currency.

Brazilian taxpayers may now “perhaps” pay their tax bill using cryptocurrency thanks to a collaborative endeavor with Brazilian crypto company Bitfy, according to a statement released by Brazilian bank Banco do Brasil on February 11. Brazilians can use it if they have cryptocurrency in Bitfy’s custody, which will serve as a “collection partner” for the Brazilian central bank.

In addition to the convenience it offers clients, it was observed that it might “extend” usage and access to the ecosystem of digital assets with “national coverage” and the security of a respected bank offering consumer protection.

The creator and CEO of Bitfy, Lucas Schoch, said, “The new digital economy is a catalyst for a future full of benefits.”

The Process of paying taxes

According to the statement, using a cryptocurrency would be a simple process, with the tax information provided along with the number of reals, the Brazilian real, that should be translated into the preferred cryptocurrency to pay the payment. By scanning a barcode, taxpayers will have access to their tax bill, just like they do when purchasing a “boleto,” or ticket, a standard payment option in Brazil.

This action follows Rio de Janeiro, Brazil’s largest city, which began accepting cryptocurrency as tax payments in October 2022. Brazil approved a regulatory framework in December 2022 that makes it acceptable to utilize cryptocurrency as a form of payment there.

The bill will go into force in June of this year.

Brazilian nationals were previously informed that they would be subject to taxes on like-kind cryptocurrency exchanges, such as trading Bitcoin for Ether, in May 2022. But not all Brazilian cryptocurrency traders are required to disclose their transactions. According to the commission, only investors who transact in cryptocurrency for more than 35,000 reals ($6,711) are required to pay income taxes.