The Senate will resume discussion on Bitcoin regulation in February 2022, with the bill providing for zero tax on mining equipment in Brazil. In the legislative house, three bills presented by parliamentarians are being processed, which are the PL 3.825/2019, by Flávio Arns (Podemos-PR), PL 3.949/2019, by Styvenson Valentim (Pode-RN) and PL 4.207/2020, by Soraya Thronicke (PSL-MS).
With similar proposals, the projects ended up being brought together by the rapporteur Senator Irajá (PSD-TO), who ended up preparing an opinion in November 2021. of several postponements, has been pushed to 2022.
If this project is approved in the Senate and Chamber of Deputies, one of the points foresees the impact on mining activity in Brazil.
What does the opinion that provides for zeroing the tax on Bitcoin mining equipment in Brazil?
Bitcoin mining is an essential network activity, validating secure blocks of transactions every 10 minutes on average. For this, powerful equipment is needed that performs large-scale mathematical calculations in order to find the next valid block in the network.
In this way, ASICs emerged, which are devices that connected to the Bitcoin network start looking for new blocks to receive their reward. As in Brazil this equipment is expensive, and bringing it across the border is a risky activity, many people stop mining Bitcoin at home.
Despite this, in the last few days two lucky Bitcoin miners have found two valid blocks, getting a million-dollar reward each.
But if the rapporteur’s Opinion PL 3825/2019 is approved in the Federal Senate, this could change, at least until December 31, 2029. This is because, in its article 14, the document provides that Bitcoin mining equipment in Brazil will have their tax zeroed if they use renewable energy sources.
And not only hardware that will have zero taxes, but software as well. In addition to the mining activity, legal entities that work with processing and preservation of virtual assets, that is, custody, can also enter this.
However, companies must be duly admitted and approved by the local electricity concessionaire, according to ANEEL Resolution No. 687/2015.
Once the requirements are met, which taxes will be zeroed?
Companies that comply with all the determinations described in this bill must then proceed to acquire the items necessary for their structure.
If the equipment and software are acquired via importation, the taxes of Contribution to PIS, Cofins Importation, IPI and Import Tax will be exempt.
However, if the company buys the equipment in the national market, the Contribution to PIS, Cofins and IPI will be exempt. With less taxes for future Bitcoin mining farms in Brazil, entrepreneurs will be able to generate more jobs and invest in the sector, heating up the production of digital currency in the country.
It is worth remembering, however, that this is just a bill still being evaluated by a commission, which must still be sent to the Chamber of Deputies to be approved and then sent for sanction by the president. That is, the process may take time and there is no forecast of its approval, despite containing a promising scenario for companies.
Considering only this point, the seem could be interesting at a time when several countries are looking to attract Bitcoin miners after China’s 2021 ban, despite favoring institutional rather than domestic mining.