The Superior Court of Justice (STJ) has ruled that ICMS, PIS, and Cofins cannot be excluded from the tax base of the Tax on Industrialized Products (IPI). The understanding was established by the 1st Section through repetitive appeals and must be followed by all lower courts. The decision was unanimous.
Taxpayers, mostly industries and importers, argued for the exclusion based on the "thesis of the century" from the Supreme Federal Court (STF), which removed ICMS from the calculation of PIS and Cofins contributions (Topic 69). However, according to the rapporteur, Minister Teodoro Silva Santos, the analogy "is not applicable because the material facts and calculation bases are distinct.".
The result benefits the National Treasury, as it understands that the National Tax Code (CTN) allows the inclusion of one tax in the tax base of another tax. According to article 47, item II, subparagraph “a”, the IPI tax base is the value of the transaction, or, when it is not possible to determine it, the sales value of the product.
Article 14, item II, paragraph 1 of Law No. 4,502 of 1964, adds that the value of the transaction includes "the price of the product, plus the value of freight and other incidental expenses charged or debited by the taxpayer to the buyer or recipient".
According to Minister Teodoro Silva Santos, the concept of "operating value" corresponds to the total value of the goods leaving an industrial establishment, "including the taxes that make up the price of the product" (Topic 1304). This understanding was shared by the other ministers.
He emphasized that the court's jurisprudence is already firm regarding the impossibility of excluding ICMS, PIS, and Cofins from the IPI tax base due to the absence of legal provision. The minister recalled a precedent from 2005, from the 2nd Panel, which already stated that "doctrine and jurisprudence are unanimous in proclaiming the inclusion of ICMS in the IPI tax base." According to this understanding, IPI is a type of tax whose calculation is done "with the ICMS embedded" (REsp 610908).
A more recent precedent from the 2nd Panel (REsp 2013239) also established that "for the purposes of calculating IPI, the taxable value of domestic products is the total value of the transaction resulting in the product leaving the industrial establishment or establishment equivalent to an industrial one, which includes the amount of taxes embedded in the so-called 'price inside' (PIS, Cofins and ICMS).".
In the First Panel, the understanding was also pro-tax authority. When judging an appeal from a concessionaire, the rapporteur of the case, Minister Benedito Gonçalves, emphasized that there was "settled jurisprudence" in the STJ regarding the impossibility of excluding taxes from the IPI base, "due to lack of legal provision" (REsp 2115638).
According to tax experts, companies had already been including the value of taxes in the IPI (Tax on Industrialized Products) calculation base because the jurisprudence was also consolidated in the Regional Federal Courts (TRFs). However, they say, this scenario does not change the fact that the effects of the decision are negative. For them, the STJ (Superior Court of Justice) missed the opportunity to align its jurisprudence with the STF's (Supreme Federal Court) understanding in the "thesis of the century".
Tax lawyer Juliana Amaro, who defended the company in one of the cases chosen as repetitive, argued in her oral presentation that PIS and Cofins taxes do not fall under the concept of the price of goods. "The value of the taxes will enter the company's cash flow and subsequently be passed on to the Federal Government; there is no acquisition of this value," she stated.
According to her, it is not possible to validate a legal norm based on its impact on the public budget. "The change needs to occur at the very beginning of tax legislation, in the interpretation of the norm."“
Emerson Cavalcante, who defended another company, added that the IPI (Tax on Industrialized Products) should be levied on the base that represents the effective wealth generated by industrial activity. "The PIS (Social Integration Program) and Cofins (Contribution to Social Security Financing), although they pass through the company's cash flow at the time of sale, are owned by the tax authorities," he said.
Maintaining an "inflated tax base" for the IPI (Tax on Industrialized Products) directly impacts the "Brazil cost," making the national industry less competitive, highlights Leonardo Roesler, partner at RCA Advogados. "At a time when the country is seeking reindustrialization and growth, the STJ's (Superior Court of Justice) decision goes in the opposite direction, acting as a brake on development," he states.
The matter can still be analyzed by the Supreme Federal Court (STF). By rejecting the logic of Topic 69, which would lead to the conclusion that taxes that "only pass through the operation do not form part of the company's assets and, therefore, cannot be the basis for another tax," the Superior Court of Justice (STJ) creates an "inconsistency" in relation to what the Supreme Court understands about contributory capacity and what actually constitutes revenue or value of the operation, according to tax lawyer Pedro Schuch, managing partner of SW Advogados.
Tax lawyer João Paulo Toledo de Rezende, partner at Mazzucco & Mello Advogados, also points out that, despite prioritizing the literal aspect of the legislation, the Superior Court of Justice (STJ) ended up authorizing the imposition of tax on transitory values. “Since the IPI (Tax on Industrialized Products) is levied on the output of goods from industrial establishments – and also from importers, who are legally equated to manufacturers – the decision accentuates the tax burden on strategic sectors, whose activity is directly linked to economic growth, precisely areas that, in theory, should be stimulated,” he states.
In a statement to Valor, the Attorney General's Office for the National Treasury (PGFN) emphasizes that "the Superior Court of Justice (STJ) upheld the jurisprudence of its two public law panels, confirming that the tax base for IPI (Tax on Industrialized Products) is the value of the transaction resulting in the sale of goods, including the values of ICMS (Tax on Circulation of Goods and Services), PIS (Social Integration Program Tax), and Cofins (Contribution to Social Security Financing).".