What to expect from the courts on tax matters during these last days of the year
Now that the elections are over, preparations for the World Cup have begun at the glorious pace of Rebeca Andrade, who placed Brazil on the highest spot on the podium at the Artistic Gymnastics World Cup, can taxpayers now head off to the end of year festivities?
Let’s hold the celebrations. There is a lot to do until the end of December in the tax arena.
November got off to a hectic start. Let fights in family groups and quarrels between friends be left behind. Life doesn’t stop and we have many important tax discussions that need to be followed up this year.
The ICMS-Difal may still be required in 2022. Judgment resumed in November with great expectations by the taxpayers for the principle of precedence to be respected. We hope that, in 2023, this topic will be a matter of the past.
The discussion of ICMS on the transfer of goods between establishments of the same taxpayer has not yet been defined. That’s right! After 20 years of the theme having been defined by the Superior Courts, the famous prospective effect and its consequences are still on hold. Even the res judicata was relativized, causing great legal uncertainty, and we still don’t know if it will still be judged this year.
There is also the need to wait for confirmation of the constitutionality of the end of the casting vote at the Administrative Council of Tax Appeals (CARF), which, together with the new compositions of the body’s judgment panels, allowed taxpayers to follow more transparent, serious and solid tax discussions, formalizing positions that bring hope to administrative issues at the federal level.
For example, we point out the innovations brought in relation to Profit Sharing Schemes (PLR), when the CARF (i) also allowed the payment to the officers of legal entities and (ii) removed the incidence of social security contribution when paying retention bonus for not having indemnifying nature. The expectation is in relation to the judgments of the big cases involving discussions of goodwill, which have been accumulated at the federal administrative courts and should soon unfold.
The definition of the unconstitutionality of the end of the CARF vote would be regrettable and a setback for the country’s federal administrative litigation.
Finishing 2022 looks difficult. However, our message for preparations for the end of the year remains positive. There’s a lot of work to be done. In addition to the expected administrative, tax and fiscal procedural reforms, Brazil expects from its judicial and administrative courts discussions that give the Constitution and the legislation a serious and positive interpretation, for the definition of the countless subjects that await judgment in the tax environment.
