By: Guilherme Martins and João Gimenes
On June 14, 2023, Minister Dias Toffoli of the Federal Supreme Court (“STF”) returned for judgment the case of General Repercussion Theme No. 487 (RE No. 640452), which deals with the definition of the limit for the application of tax fines, in cases of errors or non-compliance with accessory obligations arising from instrumental duties – declarations and issuance of tax documents required with the payment of taxes.
The discussion is very important for the inspection and collection of the States and also for all taxpayers, considering the existence of a dispute with relevant values involving the topic that can now be concluded by the Judiciary.
The case reached the STF in 2011, when its General Repercussion was recognized. However, the trial only began in December of last year, when the Rapporteur of the case, Minister Roberto Barroso, voted in favor of imposing a limit. Since then, Minister Toffoli, who had submitted a request for review of the case, returned it for trial, which is scheduled to take place in the Virtual Plenary, between June 23 and 30.
The issue was presented to the Court through extraordinary appeal no. 640,452, filed by taxpayer Eletronorte against a law of the State of Rondônia, which set a fine of 40% on the value of the operation for failure to comply with accessory obligations. In this calculation metric for the aforementioned fine, the penalty applied reached twice the amount of tax paid in the specific case.
The discussion revolves around the definition of rate limit and to calculation basis of the fine, which must be guided by the constitutional principles of prohibition of confiscation and tax capacity. Minister Barroso, in his vote, argues in order to establish the limit of 20%, that is, the isolated fine may not exceed the limit of 20% of the value of the respective tax, in cases where there is a main obligation. Thus, it defends how the calculation basis of the isolated fine should be the amount of tax charged/due, and not the value of the operation or service (which would be unconstitutional).
As an interested party, the Brazilian Tax Law Association (ABAT) presented an analysis on the application of the fine in 16 states, highlighting 11 states where the penalty is imposed on the value of the transaction, a calculation basis that is clearly higher in relation to the value of the tax. States with significant economic activity make up this census, such as São Paulo, Rio de Janeiro, Minas Gerais, Goiás, Mato Grosso, Paraná, Santa Catarina, Amapá, Ceará, Rio Grande do Norte and Sergipe.
The topic is of notable importance for the activities of companies throughout the country, given the General Repercussion recognized regarding the outcome of the trial, which will be applied throughout the national territory. Our team is available to provide any clarifications on the matter.
With the collaboration of Davi Matos and Pedro Buzas