STF Will Adjudicate The ICMS DIFAL Tax Collection In 2022; Check The Newsletter - Tax Authorities

In this Tax Law newsletter, you will find:

Supreme Federal Court will judge the ICMS DIFAL collection in 2022 with general repercussion
STF holds that refund in a writ of mandamus must be made through a precatory
Superior Court of Justice rules that tax authority is not required to verify if taxpauyer has ICMS (vat tax) credit
Superior Court of Justice rules that taxpayer can withdraw deposit without proving assumption of liabilities

Supreme Federal Court will judge the ICMS DIFAL collection in 2022 with general repercussion

The Supreme Federal Court (STF) has recognized the general repercussion of Extraordinary Appeal (RE) No. 1,426,271, in which it will assess whether the difference between the intrastate and interstate ICMS to be collected at the destination (DIFAL) could be collected in 2022 or whether it should comply with the constitutional rule of "noventena" (entering into force 90 days after the law that instituted or increased a tax) and/or "anterioridade anual" (entering into force as of the first day of the year following that in which the law instituted or increased the tax).

This matter is already known to many taxpayers because the issue is identical to that addressed in Direct Actions of Unconstitutionality (ADIs) 7,066/DF, 7,070/DF, and 7,078/CE. These actions began to be judged in 2022 but will be resumed only in STF's in-person plenary session due to a request of Minister Rosa Weber. The main discussion in these actions revolves around whether Complementary Law 190/2022, which regulates the DIFAL, instituted or increased the tax and, therefore, must comply with the grandfathering rules above before being applied.

Minister Rosa Weber, who is also the rapporteur of the aforementioned RE, argued that addressing this issue comprehensively prevents the judicial system from having to deal with many repeated decisions on the same subject. This is because, with the results of the ADIs alone, the courts cannot prevent cases that go against binding jurisprudence from reaching the higher courts.

Despite the recognition of the general repercussion, there is still no defined date for the judgment of the RE or the ADIs.

STF holds that refund in a writ of mandamus must be made through a precatory

The STF, while analyzing Extraordinary Appeal (RE) No. 1,420,691, recognized the general repercussion of the appeal and declared that the refund of funds to taxpayers after a judicial decision must follow the system of precatories.

The established thesis is as follows: "administrative refund of the undue amount recognized in the judicial realm is not admissible, and it is essential to observe the constitutional regime of precatories, as provided in Article 100 of the Federal Constitution."

This means that the taxpayer must enforce and settle the judgment through legal means in order to obtain a precatory as the sole method of receiving the amount they are entitled to, in case compensation is not possible.

This topic is always relevant when determining a procedural strategy for addressing tax matters and seeking the recovery of overpaid or improperly paid taxes.

Superior Court of Justice rules that tax authority is not required to verify if taxpauyer has ICMS (vat tax) credit

The 1st Panel of the Superior Court of Justice (STJ) unanimously decided, in the case of the Special Appeal in the Motion for a Special Appeal (AREsp) no. 1,821,549/SP, that it is not the obligation of the tax authority to verify whether the taxpayer had ICMS credits in their accounting records before issuing the infraction notice for non-payment of the tax.

In the specific case, the tax authority had assessed a debt of ICMS in the amount of R$ 1.8 million. The company argued that, at the time of the tax notice, it had an ICMS credit of 20 million and that it was the duty of the tax inspector to verify the existence of this balance and offset such amounts, under penalty of violating the non-cumulativity principle.

However, at the STJ, the Ministers rejected the appeal presented by the taxpayer, arguing that the use of ICMS credits for the purpose of offsetting the tax due is a "right to be exercised by the taxpayer at the time of self-assessment, and it is not possible to impose on the tax authority the obligation to perform this reconciliation when conducting an official assessment."

Superior Court of Justice rules that taxpayer can withdraw deposit without proving assumption of liabilities

The 2nd Panel of the STJ, unanimously decided, in the case of the Special Appeal in the Motion for a Special Appeal (AREsp) No. 2,302,212/RS, that when withdrawing a judicial deposit in a case related to the collection of the ICMS Differential Rate (DIFAL), the taxpayer does not need to provide evidence that they assumed the tax liability or obtained authorization from the consumer to do so. As a result, the Ministers rejected the appeal presented by the State of Rio Grande do Sul.

These rules are established in Article 166 of the National Tax Code (CTN) and apply when it comes to the refund of taxes that, by their nature, involve the transfer of the liability to third parties, as is the case with the end consumer.

The State argued that, even in the context of withdrawing judicial deposits, the taxpayer should demonstrate compliance with these requirements.

However, the STJ held that withdrawing a deposit is not equivalent to the refund of a tax, which is why such requirements would not be applicable to the case.

>> This newsletter was written by Matheus Barreto and André Koscak .

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.