The Superior Court of Justice (STJ), in a judgment made by the 1st Panel, decided that the profits obtained by a company, as a result of a tax benefit granted by a state economic development program, should not form the basis for calculating Corporate Income Tax (IRPJ) and Social Contribution on Net Income (CSLL).

The Court's understanding was issued in the case of Resp No. 1,222.547 and granted the special appeal filed by a soft drink company. In the specific case, the company had joined the Santa Catarina Business Development Program (Prodec), established by the State of Santa Catarina to encourage the expansion of industrial enterprises, and which provides for the benefit of deferring the payment of a percentage of the amount due monthly as ICMS. This amount would be paid later, without monetary correction and with annual interest of 4%.

According to the Brazilian Federal Revenue Service (RFB), the amounts should be included in the calculation basis for IRPJ and CSLL, since in the agency's view there is no waiver of the amount. The Regional Federal Court of the 4th Region agreed with the IRS's thesis, however, this understanding was reformed in a unanimous vote by the STJ.

The rapporteur, Minister Regina Helena Costa, applied precedents from similar cases to conclude that the inclusion of gains obtained as a result of tax benefits in the calculation basis for IRPJ and CSLL was illegal.

According to the minister, the attempt to tax such amounts – which the taxpayer failed to spend due to tax incentives granted by the state – not only demonstrates a contradictory stance on the part of the National Treasury, but also violates the federative pact established by the Federal Constitution.

In the words of the rapporteur, it would allow the Union to “withdraw, indirectly, a tax incentive that a Member State, in the exercise of its tax powers, granted“.