The institution will have a government to government system for data management

The Brazilian State will adopt the blockchain technology to speed up the job of collecting taxes in that country. Federal Collection of Brazil (RFB), the institution which is in charge of this activity, published a standard that establishes as a data exchange mechanism a blockchain network authorized by the government.

Official information indicates that the agency will conduct the new fiscal registry of natural persons through a system based on blockchain technology. The traditional process is known in Brazil as Cadastre of Physical Persons (CPF). In order to automatize the operations, a technological solution called bCPF was created, which will become the new register of taxpayers.

The decision was announced this Wednesday, November 21st. According to a press release, it modifies the old data availability procedure through the provision of partial or total replicas.

The regulation establishes a deadline of July 31st for data requests to adapt to the new network based on cryptoactive technology. According to the Brazilian legal framework, the CPF functions as an identification number and the RFB maintains more than 800 data exchange agreements with various State institutions.

According to an investigation, the Federal Collection of Brazil is interested in developing a product that will be used to distribute the information in a safe and traceable way. In order to make this possible, the team will create a Government to Government (G2G) system in partnership with Dataprev.

The project, that is in the pilot phase with the Federal Council of Justice, seeks to use smart contracts to add additional features and controls. This model contemplates three types of participation on the network: for the consumption of the data, for the contribution on certain data fields, and for data modification. The technology is based on free open source software and is expected to be fully operational within 6 months.

About the last case of participation, RFB announced that only institutions with legal authority will be able to use the platform, which will be programmed in smart contracts. The public institution recently also made a public consultation for the development of a new legal framework concerning transactions made with cryptocurrencies, where all citizens are able to detail information on each of the transactions carried out with digital assets.

Representatives of the cryptocurrency industry in Brazil presented some proposals in response to this public consultation, in order to protect the enthusiasts of the digital assets, so that the financial authorities stop their persecutory position. The proposal would be aimed at guaranteeing equal treatment with other economic agents in identical situations, such as financial institutions.

“This aspect must be highlighted even so that Brazil demonstrates, as well as Switzerland, technological neutrality, and does not discriminate identical economic activities just because of the use of new technologies”, said Yure Lira, who represented the group of proponents.

It is still unknown when the new regulations will come into force, which includes fines of up to 1,500 for late payment and up to 3% of the amount of transactions due to the omission of data.

Brazil is not the only country interested in implementing blockchain technology to its government operations. Spain is one of the largest countries enthusiastic with this technology and it is also thinking about implementing blockchain technology in its financial system.

By María Victoria Rodríguez


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