Banco do Brasil, the oldest bank in Brazil, is creating a tax payment solution for citizens holding digital assets in Bitfy, a payments platform serving users in Latin America, according to a statement on Feb. 11.
Following this deal, Bitfy will be responsible for the bank’s collection activities. These include tax payments from the bank’s users and payment of fees and liabilities to customers.
Subsequently, the move makes the bank one of the top institutions supporting cryptocurrencies. This goes a long way as Brazil generally plans to legalize crypto as a payment method.
Bitfy and Brazil have a close financial relationship with the crypto firm having have invested in the bank’s corporate venture capital program.
The tax payment process
To pay taxes using the app, users must select the cryptocurrency they want to use, capture the barcode, or use the sequence numbers to validate the transaction.
Before the payment is processed, all vital payment information will appear on the interphase for the taxpayer to verify. The conversion rate will happen at market price immediately after the transaction is commenced.
The CEO of Bitfy, Lucas Schoch, said “the new digital economy” reinforces a new beginning to brighter days ahead. He continued that the alliance will continue to expand the mass adoption of cryptocurrencies and increase awareness of the digital ecology in the nation.
Brazil’s crypto tax payment solutions align with CoinLedger’s tally, which reveals that 31% of crypto investors in the United States still need to file tax returns with the Internal Revenue Service (IRS).