The ministers of the 1st Section of the Superior Court of Justice (STJ) unanimously decided that ICMS tax benefits, such as tax rate reductions, exemptions and deferrals, are included in the calculation basis for IRPJ and CSLL. An exception, however, is the situation in which the taxpayer complies with the rules set forth in article 10 of Complementary Law 160/2017 and article 30 of Law 12.973/14. These provisions provide for the form of registration of tax incentives by states and condition the non-taxation of benefits on the reserve of profits by companies, for example.
On Wednesday, the judges also concluded that the precedent that considered that presumed ICMS credits do not enter the calculation basis for IRPJ and CSLL (EREsp 1517492/PR) should not be extended to other ICMS tax benefits.
The effectiveness of the STJ decision, however, depends on the confirmation, by the plenary of the Federal Supreme Court (STF), of the precautionary measure granted this Wednesday (4/26) by Minister André Mendonça. The judge responded to a request from the Brazilian Agribusiness Association (Abag) and ordered the suspension of the analysis of the repetitive cases in the STJ until the final decision on the merits in RE 835,818, which discusses the inclusion of presumed ICMS credits in the calculation basis of PIS and Cofins.
Mendonça's injunction caused a stir during the trial at the STJ. As soon as the defendants were called, the lawyer representing Abag, Vinicius Jucá, asked to speak to communicate Mendonça's injunction and request the suspension of the trial. The rapporteur, Benedito Gonçalves, however, stated that the STJ had not yet been officially notified of the STF's decision and that, therefore, the trial could proceed.
After oral arguments, the president of the 1st Section, Sérgio Kukina, suspended the trial and asked for the courtroom to be cleared. When the session resumed, the justices concluded that they should continue. Therefore, if the plenary of the STF overturns Mendonça's injunction, the STJ's decision will be valid. If the STF confirms the injunction, the STJ's decision will be nullified. The injunction was included in the virtual agenda from May 5 to 12, when the STF justices will decide whether or not it should be ratified.
When granting the precautionary measure, Mendonça stated that there is an intrinsic connection between the case in the STF involving the inclusion of presumed ICMS credits in the PIS and Cofins tax bases and the trial that began today in the STJ. Finally, Mendonça noted that the trial of Topic 1182 in the STJ may impact the STF's decision to be handed down in ADI 5,092, of which he is the rapporteur, which discusses the constitutionality of Complementary Law 160/2017. This rule, among other points, equates all tax benefits to investment subsidies.
Votes
The thesis of the rapporteur, Justice Benedito Gonçalves, prevailed. The judge stated that, since 2017, the 1st and 2nd Panels have been accepting taxpayers' requests, but on different grounds. The 1st Panel extended the precedent on the presumed ICMS credit to the other tax benefits of the tax. The 2nd Panel, in turn, understood that it was not possible to extend the precedent, but that, based on LC 160/17, if companies proved certain conditions, taxation could be waived.
For Benedito Gonçalves, the second position should prevail, under the provision that taxation should be waived in the event of compliance with legal requirements. The rapporteur himself adjusted his position, since he followed the understanding of the first panel, which extended the 2017 precedent. “In summary, therefore, the controversy does not consist of knowing whether or not the ICMS tax benefits will be taxed by IRPJ and CSLL, but whether or not the exclusion of these benefits from the IRPJ and CSLL calculation basis will require compliance with the conditions and requirements provided for by law,” said the rapporteur.
The judges established the following theses:
1- It is impossible to exclude tax benefits related to ICMS, such as reduction of the calculation basis, reduction of the tax rate, exemption, deferral, among others, from the calculation basis of IRPJ and CSLL, except when the requirements provided for by law are met – article 10 of LC 160/17 and article 30 of Law 12.973/14 –, and the understanding established in EREsp 1,517,492, which excludes the presumed ICMS credit from the calculation basis of the aforementioned federal taxes, does not apply to them.
2 – For the exclusion of tax benefits related to ICMS, such as reduction of the calculation basis, reduction of the tax rate, exemption, deferral, among others, of the calculation basis of IRPJ and CSLL, proof of concession as an incentive to the implementation or expansion of an economic enterprise should not be required.
3 – Considering that LC 160/2017 included paragraphs four and five to article 30 of Law 12.973/14, without, however, repealing the provisions of its second paragraph, the exemption from prior proof by the company that the tax subsidy was granted as a measure to stimulate the implementation or expansion of the economic enterprise does not prevent the Federal Revenue Service from proceeding with the assessment of IRPJ and CSLL if, in an inspection procedure, it is found that the amounts originating from the tax benefit were used for a purpose other than guaranteeing the viability of the economic enterprise.
Representatives of the parties, however, were unsure about the content of items 2 and 3 of the thesis, pointing out a possible contradiction between them. These points may be subject to a statement of clarification.
Treasury and taxpayers disagree on the issue
The understanding consolidated this Wednesday is in line with the position of the Attorney General's Office of the National Treasury (PGFN). The PGFN argues that, unlike the presumed ICMS credit, in the case of other ICMS benefits, there would be no amount to be removed from the IRPJ and CSLL calculation basis. This is because, in the case of reduction or exemption, there is a total or partial reduction of the ICMS due.
“The decision [this Wednesday] is what the Treasury was asking for, both from the point of view of the exclusion of ICMS benefits from the IRPJ and CSLL base and from the point of view that the logic of the investment subsidy, from article 30 [of Law 12.973], was maintained. This means that the investment subsidy exists and its requirements must be proven by the taxpayer”, stated the Attorney General of the National Treasury, Anelize Ruas de Almeida, at the end of the trial.
The STJ ruling was also welcomed by Finance Minister Fernando Haddad, who, after the Court’s ruling, ruled out the possibility of issuing a provisional measure to change points regarding the taxation of benefits. The minister stated on Wednesday that the STJ ruling was “exemplary”. “This decision settles the matter. Obviously, we will take other measures related to the framework to give consistency to the Budget, and we want them to be taken by August, because then the Budget can be submitted in August with a forecast of a balance or close to the balance forecast in the fiscal framework”, said the minister.
Taxpayers argue that, in accounting terms, there is no differentiation between negative and positive amounts, since every tax benefit results in an increase in assets in accounting terms. Therefore, the precedent on presumed credits should be extended.
For attorney Saul Tourinho Leal, partner at Ayres Britto and representative of Fast Indústria e Comércio LTDA, party to REsp 1.987.158, the STJ decision brought up issues that had not yet been debated in previous precedents, since the various incentives were not debated one by one, and negatively advances Law 160/17. In his view, the thesis of the judgment, by including the expression “among others”, transforms this rule into a “blank law”, since a series of other benefits that have not yet been created may be taxed.
Regarding a possible divergence between items 2 and 3 of the thesis, in a preliminary analysis, Tourinho Leal stated that the understanding is that, in order to avoid paying IRPJ and CSLL, companies do not need to previously demonstrate specific requirements that characterize investment subsidies. However, the Federal Revenue Service may, through inspection, verify that these requirements were not met and charge the tax.
“I understand that the judgment not only goes beyond our perception of what was decided in the precedent of the presumed ICMS credit but also negatively advances the law itself. There is nothing in the law that says 'among others', as in the defined thesis, and this brings an innovation”, he states.
According to Tourinho Leal, taxpayers must file a statement of clarification. To do so, they will wait for the publication of the ruling to analyze the points to be questioned. One of them would be the inclusion of the expression “among others” in the thesis, which opens the possibility for benefits that have not even been created yet to be taxed.