On February 2, 2023, the Brazilian Supreme Court (“STF”) resumed the trial of two extraordinary appeals, with general repercussions, RE 955227 (Theme 885) and RE 949297 (Theme 881), which discuss the limits of res judicata in tax matters. The STF formed a majority in the sense that the effects of a final judgment (res judicata) in tax matters of continuous treatment lose their effects when there is a subsequent judgment in the opposite direction by the STF.
Currently, it is considered one of the most relevant topics being processed by the Judiciary. We emphasize that the impact of this discussion involves and affects taxpayers who have already discussed the payment of taxes in court or who have tax proceedings in progress.
However, there is still no consensus on the modulation of the effects to be adopted in the cases. The trial will continue next Wednesday, February 8, 2023, with the discussion on the time frame for the resumption of tax collection, on the need to observe the principles of annual and nonagesimal prior notice and the establishment of theses of general repercussion.
Extraordinary Appeals No. 949,297 and 955,227 discuss the Federal Government's interest in resuming the collection of the Social Contribution on Net Income (“CSLL”) from two companies that, in the 1990s, obtained decisions that considered the law that instituted the CSLL unconstitutional, thus eliminating the collection of the contribution. The Union's argument is that since 2007, with the judgment of Direct Action of Unconstitutionality (ADI) No. 15, in which the STF declared the constitutionality of the law that instituted the CSLL, the collection could be resumed.
We highlight the difference between the two appeals, while RE No. 955,227 (Topic No. 885), reported by Min. Luís Roberto Barroso, discusses the change in understanding adopted in diffuse control of constitutionality, that is, in individual decisions, which only produce effects between the parties (within a specific case), while RE No. 949,297 (Topic No. 881), reported by Min. Edson Fachin, debates the change in understanding in decisions handed down in concentrated control of constitutionality, producing effects for all – in this scenario, the analysis, therefore, does not depend on application to a specific case.
In the judgment of Theme No. 885, Justice Luís Roberto Barroso considered that the decisions of the STF adopted on an individual basis before the judgment of the theme of General Repercussion do not automatically impact the res judicata, even in tax relations of successive fact. However, decisions handed down in direct actions or in the context of general repercussion that change an understanding about the collection of a tax, nullify the temporal effects of the res judicata in relations of continuous treatment, so that the federative entities do not need to file a rescission action.
Furthermore, the principles of non-retroactivity and annual/nonagesimal prior payment must be respected, according to the nature of the tax. The rapporteur decided not to modulate the effects of the decision, considering that a taxpayer who stops paying a tax due to a final decision has an advantage over other competitors. The vote was supported by Justices Gilmar Mendes, André Mendonça, Alexandre de Moraes and Dias Toffoli.
In turn, in the judgment of Theme No. 881, the rapporteur, Min. Edson Fachin, voted to grant the extraordinary appeal of the Federal Union, to reform the appealed decision and proposed to modulate the temporal effects of the decision to be handed down with the judgment in question so that its effectiveness will only be valid for the future, from the publication of the judgment minutes, considering legal certainty and to protect taxpayers who had not paid taxes. Ministers Luiz Fux and Nunes Marques agreed with the understanding.
Thus, the continuation of the trial will apparently be marked by discussions regarding the modulation of the effects of the judgments. Justice President Rosa Weber and Justice Ricardo Lewandowski will also vote. The tax team at Mazzucco & Mello Advogados is available to provide further clarifications on the subject.
