Rio de Janeiro, Brazil’s third-most populous state, has announced its plan to allow its citizens to pay taxes using cryptocurrencies. The city’s mayor, Eduardo Paes, and other municipality officials announced this at the Criptoatividade Carioca (Cryptoactivity Carioca) event, organized by the municipal secretariats of Finance and Planning, Innovation and Simplification, and Economic Development.
A New Crypto Hub in the Making
Together with other officials, the mayor agreed to allow the collection of cryptocurrencies for Urban Building and Land Tax, commonly known as IPTU, starting from 2023. He said:
“Now those who invest in cryptocurrency and live in the city of Rio will be able to spend this asset here paying official tax in the city of Rio. And we’re going to move on this fast.”
The announcement comes a few months after Paes revealed in January that the city was creating a working group to discuss how to accelerate the use of cryptocurrencies to boost the local economy. During the time, Paes revealed that Rio de Janeiro would invest 1 percent of its capital into cryptocurrency.
The initiative makes Rio de Janeiro the first city in Brazil to allow citizens to use cryptocurrencies to pay taxes. Without a doubt, this move demonstrates Rio’s significant strides towards becoming a global crypto hub.
The Current Plans
According to the report coming from Rio De Janeiro’s City Hall, the city will hire numerous companies that will help convert cryptocurrencies into Brazilian real. On the same note, the city is also laying down the strategies for collecting its own non-fungible tokens (NFTs) that will feature its most famous tourist spots.
To add to this spectacular goal, Rio will also be establishing an institution, the Municipal Committee for Crypto Investments (CMCI), whose role will be overseeing the city’s channeling of funds into the crypto economy in compliance with the policies of Brazil’s central bank and the Securities and Exchange Commission.
The Municipal Committee for Crypto Investments will also develop and refine a methodology based on risks and profitability analysis and ensure compliance with Brazil’s existing laws governing public spending.
Mayor Paes’ decision is anchored on the thriving nature of cryptocurrency. He stated that this new initiative acknowledges the booming crypto market and allows the Rio citizens to invest in crypto. Moreover, to extend the tax payment options, the city will also assign third-party companies the task of paying and converting cryptocurrencies into fiat money.
More Crypto Services
Paying taxes is not only Rio’s primary priority. Pedro Paulo, the city’s Secretary of Finance and Planning, hinted that plans are underway to integrate more services under this crypto payment system.
Some of the key target areas include car rides, and the use of crypto-assets and non-fungible tokens to revitalize the arts, culture, and tourism industry. Asserting that the achievement of these goals may require a solid foundation, the secretary expressed optimism that the authority would embark on building a responsible governance policy to evaluate the impact of crypto investments.
High Aspirations for Rio
So, what’s up with Rio de Janeiro? The city officials want to make it the ‘technology capital of the country.’ Chicão Bulhões, Rio’s secretary of economic development, innovation, and simplification (SMDEIS), made it clear that their focus is to transform Rio de Janeiro into the technology and innovation capital of the country.
While the decision to accept cryptocurrency for tax payment and to make Rio de Janeiro the technology and innovation capital of the country has been warmly received, it is expected that the move will inspire other members of the Federative Republic to implement similar payment solutions.
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