Summary
Full Decision
ARBITRAL DECISION
I - REPORT
A - IDENTIFICATION OF THE PARTIES
Claimant: A..., taxpayer number..., with tax domicile at Rua ... - ..., Lisbon, hereinafter referred to as the Claimant or Taxpayer.
Respondent: Tax and Customs Authority, hereinafter referred to as the Respondent or TA.
The Claimant filed a request for constitution of an Arbitral Tribunal in tax matters and a request for arbitral decision, pursuant to the provisions of paragraph a) of Article 2, no. 1 and paragraph a) of Article 10, no. 1, both of Decree-Law no. 10/2011, of 20 January (Legal Regime for Arbitration in Tax Matters), hereinafter briefly referred to as LRAT.
The request for constitution of the Arbitral Tribunal was accepted by the President of the Administrative Arbitration Centre (CAAD), and in accordance with the provisions of paragraph c) of Article 11, no. 1 of Decree-Law no. 10/2011, of 20 January, as amended by Article 228 of Law no. 66-B/2012, of 31 December, the Tax Authority was notified on 2018-03-16.
The Claimant did not proceed to appoint an arbitrator, and therefore, pursuant to the provisions of Article 6, no. 1 and paragraph b) of Article 11, no. 1 of Decree-Law no. 10/2011, of 20 January, as amended by Article 228 of Law no. 66-B/2012, of 31 December, the Ethics Council appointed Ms. Rita Guerra Alves as Arbitrator, accepted by her in accordance with legal provisions.
On 2018-05-09, the parties were duly notified of this appointment, and neither expressed a desire to decline the arbitrator's appointment, in accordance with Article 11, no. 1, paragraphs a) and b), of the LRAT and Articles 6 and 7 of the Code of Ethics.
The Single Arbitral Tribunal was regularly constituted on 2018-05-29, to consider and decide the subject matter of the present dispute, and on that same day the Tax and Customs Authority was automatically notified, as recorded in the respective minutes.
No witness evidence was produced, and therefore, in the procedural sequence, the meeting referred to in Article 18 of the LRAT was dispensed with.
The parties have legal personality and capacity, are legitimate parties, and are represented (Articles 4 and 10, no. 2, of the same instrument and Article 1 of Ordinance no. 112-A/2011, of 22 March).
The proceedings do not suffer from defects that would invalidate them.
B - THE CLAIM
The Claimant petitions for a declaration of illegality of the tax assessment act for Municipal Property Tax (IMI) no. 2009..., relating to the fiscal year 2009, in the total amount of €8,494.37 (eight thousand four hundred and ninety-four euros and thirty-seven cents).
C - GROUNDS FOR THE CLAIM
To substantiate its request for arbitral decision, the Claimant alleges, with a view to obtaining a declaration of illegality of the tax assessment act for Municipal Property Tax (IMI), as already described in section 1 of this Award, the following:
The Claimant is the owner of the property in full ownership with divisions capable of independent use, located at Rua ..., no. ..., in Lisbon, registered in the urban property register under article ... of the parish of ... .
Various floors of this property were rented out, specifically: Ground Floor Left, Ground Floor Right, 1st Floor Right, 2nd Floor Left, 2nd Floor Right, 3rd Floor Right, 3rd Floor Left, 4th Floor Left and 5th Floor Right.
On 24 March 2008, the Claimant requested the assessment of the said property from the Lisbon Tax Office ..., for purposes of extraordinary updating of the rents of the aforementioned floors, under the New Urban Leasing Regime.
In the said declaration, the Claimant marked in Table II "Reason for Submission of Declaration" Field 13 "Request for Assessment".
The Claimant was subsequently notified of the assessment forms.
Having obtained the assessment of the property and the conservation condition coefficient for each of the said "units", the Claimant proceeded to communicate the rent values to the tenants.
For this purpose, it sent letters to the tenants (registered with acknowledgment of receipt) informing them, briefly: (i) that the rent would be due after a phasing-in period, which could be two, five or ten years; (ii) that the tenants had 40 days to invoke circumstances that would entitle them to a longer phasing-in period; and (iii) that, if they said nothing within that period, the phasing-in would be five years.
Some tenants invoked that they were over 65 years old, and in those cases the rent update was set with a phasing-in period of ten years, beginning in July 2010.
Other tenants did not respond to the letter within the period granted to them, and in those cases the rent update was set with a phasing-in period of five years, starting from July 2010.
Subsequently, communication was made to the Tax Office of the phasing-in periods.
The Claimant was subsequently notified, by reference to the year 2009, of the IMI Assessment no. 2009..., in the amount of €8,494.37.
The said IMI Assessment is based on the VPT (Taxable Patrimonial Value) assigned to the property registered in the urban property register under article ..., determined on 01 March 2010.
The Claimant argues that its Declaration Form 1 for IMI was submitted for "Request for Assessment" and not, as the Tax Authority alleges, for "1st Transfer During the IMI Regime".
It states that from the comparison of the elements contained in the decision denying the hierarchical appeal with the certificate issued by the Tax Authority, it is evident that there was a transcription error of the information contained in Form 1 delivered by the Claimant into the Tax Authority's computer system.
It further alleges that while in Form 1 delivered by the Claimant Table II, Field 13 "Request for Assessment" was marked, in the Tax Authority's computer system it is recorded (certainly by transcription error) that the same declaration was submitted for "1st Transfer During the IMI Regime" (i.e., Table II, Field 15).
The Claimant contends that in the case at hand, there was a phased increase in rent - over five or ten years, depending on the floors - and therefore, according to the transitional regime in no. 2, Article 17 of Decree-Law no. 287/2003, of 12 November, the IMI should apply, not, as results from the assessment challenged here, to the entirety of the VPT, but to the part of that value corresponding to a percentage equal to that of the updated rent over the amount of the maximum new rent.
It further alleges that if the law provides that IMI applies to the part of the taxable patrimonial value corresponding to a percentage equal to that of the updated rent over the amount of the maximum new rent, and because the tax offices can only assess the IMI after the landlord communicates it, pursuant to Article 42 of the NUAR, the phasing-in periods of the rent value update or, if this does not occur, at least after the 40-day response period for tenants has elapsed, as mentioned above, counting from the letters sent by the landlords.
It refers to the fact that here too we must distinguish between normal assessment cases and those in which the assessment was requested for purposes of extraordinary rent updating. For while in the former case the IMI assessment may be carried out immediately, in the latter case it is necessary to await the conclusion of the rent updating procedure under the NUAR to, on the basis of the phasing of the rent values, establish the phasing of the tax.
In the year to which the tax relates - 2009 - the property had not yet been assessed and, consequently, there was not even a phasing-in of rent, so the Tax Administration could not assess the tax with reference to this year.
It further contends that the interpretation that the Tax Authority makes of the case in question results from the fact that it considered the Declaration Form 1 for IMI was submitted for the reason of 1st Transfer During the IMI Regime and not, for the purpose properly declared by the Claimant, for purposes of property assessment.
The Claimant concludes by contending that the IMI assessment claimed is illegal, due to breach of, among others, no. 2, Article 17 of Decree-Law no. 287/2003, of 12 November, as amended by Law no. 6/2006 of 27 February, which approved the NUAR, and should therefore be revoked to the extent that it contradicts the above, with all legal consequences.
D - RESPONSE OF THE RESPONDENT
The Respondent, duly notified for this purpose, timely filed its response, in which, in brief summary, it alleged the following:
In the case at hand, the date of death of the heir's author is relevant, which occurred on 13.03.2008.
It alleges that the question is whether the IMI assessment challenged should be based on the VPT determined in accordance with Article 38 of the IMI Code, calculated in accordance with Article 15, no. 2 of DL 287/2003, of 12 November, or the VPT determined in accordance with the final part of no. 2 of Article 17 of the said DL 287/2003.
It states that as a result of the death of the property owner, since the property had not yet been subject to assessment in accordance with general rules, it was necessary to update the VPT by force of the provisions in no. 3 of Article 13 of the IMI Code, which establishes that it is the duty of the head of the tax office to do so ex officio.
It further notes that no. 1 of Article 37 of the IMI Code provides that the initiative for property assessment lies with the head of the competent tax office based on the declaration presented by the taxpayers or on any elements at its disposal, and no. 3 states that the assessment is dated to the date of the request for registration or update of the property in the register.
It alleges that the submission of Declaration Form 1 for updating IMI could only be based on the reason of 1st Transfer During the IMI Regime, regardless of the marking of Field 13, insofar as at the date of its submission on 24.03.2008, the death of the declarant had already occurred on 13.03.2013.
It further alleges that in the face of all the documents produced in the proceedings by the Claimant and those contained in the administrative file, there is no error or omission in the transcription of Declaration Form 1 for registration or updating of IMI delivered on 24.03.2018, since at that date the death of the declarant and heir author B... had already occurred.
The taxable event that gave rise to the 1st Gratuitous Transfer During the IMI Regime, which would necessarily originate the assessment of the property in accordance with Article 38 of the IMI Code.
It further states that the Claimant also has no reason in claiming that the VPT to be considered in the IMI assessment for the year 2009 should be calculated in accordance with no. 2 of Article 17 of DL 287/2003, of 12/11, insofar as the property had been assessed in accordance with Article 38 of the IMI Code less than three years ago, an assessment that is dated to the date of the request for update, 24.03.2008, in accordance with no. 4 of Article 37 of the same Code.
The Respondent concludes by contending that the Claimant cannot seek the application of the transitional regime for rented urban properties provided for in no. 2 of Article 17 of DL 287/2003, of 12/11, when the VPT was fixed less than three years ago, in accordance with Article 38 of the IMI Code, as a result of the 1st gratuitous transfer of the properties during the IMI regime, and not for updating rents under the New Urban Leasing Regime.
E - FACTUAL FINDINGS
Prior to addressing the questions raised, it is necessary to present the material facts relevant to their understanding and the decision to be rendered, based on the facts alleged by the parties and the documentary evidence produced in the proceedings.
As to the material facts considered relevant, this Tribunal establishes as proven the following facts:
On 13.03.2008, the death of B..., the former owner of the property registered under article ... of the parish of ... (now extinct), mother of the Claimant, occurred.
On 24.03.2008, the representative of B... submitted Declaration Form 1 for IMI in which Table I - Owner of Property or Unit - appears, and Table II - Reason for Property Registration Declaration - shows Field 13 "REQUEST FOR ASSESSMENT" marked.
On 04.03.2010, assessment forms nos. ..., ..., ..., ..., ..., ... and ..., relating respectively to units Ground Floor Left, 1st Floor Right, 2nd Floor Right, 2nd Floor Left, 3rd Floor Right, 4th Floor Left and 5th Floor Right of the property, were notified to B..., the heir author.
On 01.05.2010, the IMI assessment note for the year 2009 no. ... was issued.
On 27.01.2011, the Claimant filed a gracious complaint of the said IMI assessment with number ...2011..., and on which a dismissal order was issued on 29.02.2012, issued by the Head of the Administrative Justice Division of the Lisbon Tax Office;
On 02.04.2012, the Claimant filed a hierarchical appeal of that order, which was processed under number ...2012..., and which was dismissed by order of the Deputy Director-General, on 24.11.2015, notified by letter 2017....
The Claimant acquired the said properties by reason of inheritance from her mother, the former owner of the properties, who died on 13.03.2008.
The Claimant on the NUAR digital platform "Housing Portal" requested for all units the following:
On 2008-03-17, a request for the conservation level of the building.
On 2008-03-17, a request for RABC level for all units.
On 2008-09-09, a request for fiscal assessment for all units.
F - FACTS NOT PROVEN
Of the facts of interest for deciding the case, contained in the challenge, subject to concrete analysis, those that do not appear in the factual description above were not proven.
G - ISSUES TO BE DECIDED
Given the positions of the parties adopted in the arguments presented by each, the central issue is the following, which must therefore be addressed and decided:
The declaration of illegality of the tax assessment act for Municipal Property Tax no. 2009..., relating to the fiscal year 2009, in the total amount of €8,494.37 (eight thousand four hundred and ninety-four euros and thirty-seven cents);
The payment of compensatory interest.
H - LEGAL MATTERS
Given the position of the parties assumed in their pleadings, the central issue to be resolved by this Arbitral Tribunal consists of assessing the legality of the Municipal Property Tax assessment act no. 2009..., relating to the fiscal year 2009.
Considering the factual matters established, it is necessary to determine the applicable law, giving priority, in compliance with the provisions of paragraph a) of Article 124, no. 2 of the TCPT, to the analysis of the defects in the assessment act, the finding of which determines a more stable and effective protection of the Claimant's interests.
The issue to be decided, given the factuality established as proven and the legal provisions in force at the date of the facts, relates primarily to assessing the legal-tax framework provided for in the text of Articles 15 and 17 of DL 287/2003 of 12 November and Article 38 of the IMI Code.
Specifically, it consists of determining whether the IMI in question should apply to the VPT determined in accordance with Article 38 of the IMI Code, or whether it should apply to the value determined in accordance with Article 17, no. 2 of DL 287/2003 of 12 November.
To this end, it is necessary for this Tribunal to conduct an assessment of the legislation in force at the date of the facts.
Starting from the date of assessment, Article 15 of DL 287/2003 of 12 November prescribes the following:
"Article 15 - Assessment of properties already registered in the register
1- Until such time as a general assessment is carried out, urban properties already registered in the register shall be assessed, in accordance with the IMI Code, at the time of the first transfer occurring after its entry into force. (Wording given by Law no. 6/2006, 27 February, entering into force 120 days after its publication.)
2 – The provisions of no. 1 apply to the first gratuitous transfers exempt from transfer tax, as well as those provided for in paragraph e) of no. 5 of Article 1 of the Transfer Tax Code, occurring after 1 January 2004, inclusive.
3 – The provisions of this article also apply to the first transfers of corporate interests in companies subject to Transfer Tax, or of commercial, industrial or agricultural establishments whose assets include urban properties, occurring after 1 January 2004, inclusive.
4 – A general assessment of urban properties shall be promoted within a maximum period of 10 years after the entry into force of the IMI Code.
5 – When a general assessment of urban or rural properties is carried out, a percentage of up to 5, to be fixed and regulated by ordinance of the Minister of Finance, of the IMI collected in the years in which such assessment is carried out shall be allocated for the expenses of the assessment service.
6 – In the case of gratuitous transfers of urban properties, the declaration form no. 1 of the municipal property tax, approved by Ordinance no. 1282/2003, of 13 November, shall be submitted within the period established in no. 3 of Article 26 of the Transfer Tax Code. (Wording given by Decree-Law no. 238/2006, of 20 December, applicable from the entry into force of Decree-Law no. 211/2005, of 7 December.)
7 – The architectural plans provided for in no. 2 of Article 37 of the Municipal Property Tax Code, to be attached to declaration form no. 1, for purposes of assessment of the properties referred to in no. 1, shall be supplied free of charge by the municipal authorities, on declaration that they are intended exclusively for compliance with the obligation imposed by this article, with those entities being able to charge only the costs associated with the reproduction of those documents. (Wording given by Decree-Law no. 238/2006, of 20 December, applicable from the entry into force of Decree-Law no. 211/2005, of 7 December.)
8 – The provisions of no. 2 of this article do not apply to the spouse, descendants and ascendants, in transfers by death of which they are beneficiaries, save express intention by the parties themselves. (Wording given by Law no. 64-A/2008, of 31 December, entering into force 1 January 2009.)"
Next, let us examine what Article 17 of DL 287/2003 of 12 November establishes:
"Article 17 - Transitional regime for rented urban properties
1 – For IMI purposes exclusively, the taxable patrimonial value of a rented urban property or part thereof is determined in accordance with the preceding article, with the exception of the provisions of the following numbers.
2 – When an assessment is carried out on a rented property, the IMI shall apply to the taxable patrimonial value determined in accordance with Article 38 of the IMI Code, or, if there is a phased increase in rent, in accordance with Article 38 of Law no. 6/2006, of 27 February, which approves the New Urban Leasing Regime, to the part of that value corresponding to a percentage equal to that of the updated rent provided for in Article 39, Article 40, Article 41 and Article 53 of the said law over the maximum amount of the new rent.
3 – When the landlord requests the assessment of the property for purposes of rent update and cannot proceed with the update due to the conservation level of the leased property, the IMI shall apply to the taxable patrimonial value determined in accordance with Article 38 of the IMI Code from the 3rd year following that of the assessment.
4 – If the assessment has not been carried out in accordance with no. 2, in the year of entry into force of Law no. 6/2006, of 27 February, which approves the New Urban Leasing Regime, the taxable patrimonial value of a rented urban property or part thereof, under a contract still in force and which gave rise to rent payments up to 31 December 2001, is that resulting from the capitalization of the annual rent by applying the factor 12, if such value is less than that determined in accordance with the preceding article.
5 – From the year following entry into force of Law no. 6/2006, 27 February, which approves the New Urban Leasing Regime, and whilst no assessment exists in accordance with Article 38 of the IMI Code, the taxable patrimonial value of the property, for IMI purposes, is determined in accordance with the preceding article. (Wording given by Law no. 6/2006, 27 February, entering into force 120 days after its publication.)"
Complementing the said legal instruments with the NUAR and Ordinance no. 1192-A/2006 and NUAR (version of Law no. 6/2006, of 27/02, rectified by Law no. 24/2006, of 7/04), we conclude that requests for assessment for purposes of rent updating, provided for in Article 35, are made in compliance with the procedures provided for in Ordinance no. 1192-A/2006.
Thus, it follows from Ordinance no. 1192-A/2006, that through the said simplified model, landlords would have to request the fiscal assessment of the leased property for purposes of applying the special regime (cf. Article 2, no. 1, paragraph a) and Articles 4 and 5, all of Ordinance no. 1192-A/2006, of 3 November).
Now, the request for assessment for purposes of no. 2 of Article 17 of DL 287/2003 of 12 November is complemented by Ordinance no. 1192-A/2006 and its respective simplified model.
Given the above, it follows that the Claimant, for purposes of the phasing-in provided for in no. 2 of Article 17 of DL 287/2003 of 12 November, must request the fiscal assessment of the leased property in accordance with the Municipal Property Tax Code (IMI Code), by means of declaration form no. 1 of the IMI approved by Ordinance no. 1282/2003, of 12 November, and comply with the procedures provided for in Articles 4 and 5 of Ordinance no. 1192-A/2006.
Thus, the Claimant should request from the TA the assessment of the property, preceded by communication of the assessment to the tenants, in accordance with Articles 35, 36 and 37 of the NUAR, and subsequently communicate again to the TA the result of the phased updating of the rent value in accordance with Article 38.
Thus, and applying Article 17, no. 2 – "if there is a phased increase in rent, in accordance with Article 38 of Law no. 6/2006, of 27 February, which approves the New Urban Leasing Regime, to the part of that value corresponding to a percentage equal to that of the updated rent provided for in Article 39, Article 40, Article 41 and Article 53 of the said law over the maximum amount of the new rent."
In this way, the tenant must comply with the above-mentioned, in order to have the right to the phasing-in provided therein.
If they do not make the request for assessment in Form 1, then we would be faced with a request for assessment by their express will, in accordance with Article 15, no. 1, 2 and 8 of DL 287/2003 of 12 November.
On this matter, there is case law, which will be followed closely, in particular, the decision handed down by CAAD in case number 79/2012-T, from which the following is transcribed:
"The process of updating rents provided for in the NUAR consists of Articles 30 and following of Law no. 6/2006, of 27 February and is regulated in Ordinance no. 1192-A/2006, of 3 November, which approves a single simplified model incorporating all requests and communications legally provided for, including the request for fiscal assessment of the leased property in accordance with the IMI Code.
This special regime applies regardless of whether the (first) transfer of the rented urban property has occurred, being, however, a requirement for its application that an assessment procedure for a rented property be initiated or be in progress under the IMI Code.
Indeed, the phrase "when an assessment is carried out on a rented property" refers in an express and, in our view, unequivocal manner, to the application of the special regime to a moment when the rented property is (and can be) being assessed for IMI purposes (an assessment that can only be triggered on the basis of rent updating).
If the base of taxation can be subject to this special regime, proportional and gradual (pro rata temporis) when there is a phased increase in rent in accordance with the NUAR, this does not mean that the fiscal assessment procedure in which it is framed does not continue to have to observe the general rules set out above.
Indeed, the prerequisites remain which, in accordance with the rules of the IMI Code, must be met for assessment operations to take place.
In other words, the fiscal assessment of the leased property must be admissible in the light of the rules governing the procedure and direct assessment operations provided for in the IMI Code.
Thus, if less than three years have not elapsed on an assessment procedure relating to the same rented urban property, a new assessment procedure cannot be initiated, and one must wait for the minimum value stabilization period of the property's fiscal value to elapse.
The architecture of the discipline of the cited no. 2 of Article 17 of the instrument approving the IMI Code, which has a transitional character, has as its implicit foundation, in the first place, situations in which the first assessment occurs during the IMI regime, in which its application is relatively straightforward. Now, in this case, the Claimants had already assessed the properties under the IMI, so this is not a rent update inserted in a process of first fiscal assessment "post-IMI".
However, we do not consider that the provision restricts its field of application to cases of first assessment, since it refers generically to the assessment of the property (whether the first, second or third after the IMI regime begins). It is therefore necessary to assess, even in situations of properties already assessed, whether the requirements of its provision are met.
If in the case of first assessments "post-IMI" the three-year obstacle of the previous assessment is inapplicable, in other situations we are faced with a negative prerequisite which, if established, prevents (at least temporarily, until the period elapses) the initiation of a new assessment procedure.
3.3. From the analysis of the facts, it is found that the Claimants, on 4 September 2009, requested the patrimonial assessment for IMI purposes of the 5 units above identified, acquired by deed of partition of the father and husband, through the submission of Declaration Forms 1 for registration or updating of urban properties in the register, with the Tax Office, marking the field "1st Transfer During the IMI Regime".
In this way, the Claimants prompted (initiated) a direct assessment procedure for the aforementioned units, under Article 15, no. 1 of Decree-Law no. 287/2003, of 12 November and Article 38 of the IMI Code, such [prompt] they were not obliged to do in view of the provisions of Article 15, no. 8 of that Decree-Law, relating to transfer by death situations for the spouse or descendants.
This assessment procedure, or rather, the first (optional) assessment after the entry into force of the IMI Code, was not, therefore, framed by the Claimants within the scope of the special regime provided for in no. 2 of Article 17 of Decree-Law no. 287/2003, nor triggered through the proper procedure provided for this purpose (of the special regime), via submission of the simplified model (Single NUAR Model) of Ordinance no. 1192-A/2006, in the terms set out therein.
It was through the said simplified model that the landlords would have to request the fiscal assessment of the leased property for purposes of applying the special regime (cf. Article 2, no. 1, paragraph a) and Articles 4 and 5, all of Ordinance no. 1192-A/2006, of 3 November). In addition, at that date the rent updating process had not even been initiated.
It was thus a general assessment under Article 38 of the IMI Code, and as such properly framed by the Tax Office, in accordance with the declarations of the Claimants themselves, without the application of the special transitional regime for rented urban properties being raised."
The position taken in the arbitral decision above transcribed is clarifying, in the sense that in order to benefit from phasing-in, it is necessary to comply with the procedures provided for in Articles 2, no. 1, paragraph a), 4 and 5, all of Ordinance no. 1192-A/2006, of 3 November.
Given the legal-tax framework referred to above, the case law cited and the factuality established as proven, we establish as certain that:
The Claimant acquired the said properties by reason of inheritance from her mother, the former owner of the properties, on 13.03.2008.
In accordance with the certificate issued by the Tax Office on 16/02/2018, relating to Form 1 for IMI, submitted on 23 March 2008, relating to the urban property ... of the Parish of ..., of the Council of Lisbon, it follows that the Claimant submitted Declaration Form 1 for IMI in which Table I - Owner of Property or Unit - appears, and Table II - Reason for Property Registration Declaration - shows Field 13 "REQUEST FOR ASSESSMENT" marked.
From Form 1 for IMI, there is a specific field for "1ST TRANSFER DURING THE IMI REGIME".
It is entirely clear that the Claimant made the "REQUEST FOR ASSESSMENT", that is, the Claimant did not make the request for "1ST TRANSFER DURING THE IMI REGIME".
Indeed, the Claimant requested on 2008-09-09, under the NUAR and Ordinance no. 1192-A/2006, on the respective NUAR digital platform "Housing Portal", the request for fiscal assessment for all units.
Next, having obtained the assessment of the properties, the Claimant communicated the same to the tenants, and subsequently to the TA for purposes of phasing-in, in accordance with the provisions of no. 2 of Article 17 of DL 287/2003 of 12 November.
In this manner, the Claimant complied with the procedures provided for in Ordinance no. 1192-A/2006 and the NUAR.
However, the TA, for its part, considered that the properties had not yet been subject to a general assessment in accordance with Article 38 of the IMI Code, and that therefore, in consequence of the first transfer of the properties resulting from inheritance, the properties should be subject to that assessment, in accordance with no. 2 of Article 15 of DL 287/2003 of 12 November.
However, the application of Article 15, no. 2 of DL 287/2003 raises no doubt as to the assessment for transfer by death, since the assessment only applies by express will in the present case of the descendant: "The provisions of no. 2 of this article do not apply to the spouse, descendants and ascendants, in transfers by death of which they are beneficiaries, save express intention by the parties themselves."
In the present proceedings, there was no express intention on the part of the Claimant (descendant) to carry out the assessment.
Article 15, no. 8 of DL 287/2003 is limited in the present proceedings to the ex officio assessment by the TA, in accordance with Article 15, no. 8 of DL 287/2003 and no. 3 of Article 13 of the IMI Code, insofar as it restricts the assessment to the express intention in the present case of the Descendant now Claimant "save express intention by the parties themselves." (Article 15, no. 8 of DL 287/2003)
In light of the foregoing, it being solely the responsibility of the Descendant now Claimant to decide whether to proceed with the assessment of the property, the argument invoked by the TA regarding the ex officio assessment of the property is unfounded, namely "As a result of the death of the property owner, since the property had not yet been subject to assessment in accordance with general rules, it was necessary to update the VPT by force of the provisions in no. 3 of Article 13 of the IMI Code, which establishes that it is the duty of the head of the tax office to do so."
Indeed, the Claimant proceeded to request the assessment for purposes of no. 2 of Article 17 of DL 287/2003 of 12 November, and complied with the procedures above identified, and as such has the right to the phasing-in of the tax provided for therein.
As a consequence, this Tribunal grants the Claimant's request, finds the request procedurally admissible for a declaration of illegality of the tax assessment act for Municipal Property Tax no. 2009..., relating to the fiscal year 2009, due to a defect in law.
The Arbitral Tribunal, in accordance with Articles 608, no. 2, 663, no. 2 and 679 of the Code of Civil Procedure, as applied by Article 29 of the LRAT, is not obligated to consider all the arguments alleged by the Claimant or the Respondent, when the decision is prejudiced by the solution already rendered, which is the case here, and therefore the remaining questions submitted for arbitral decision are left unresolved.
I - COMPENSATORY INTEREST
The Claimant further petitions for the payment of compensatory interest.
In light of the foregoing, the assessment of the tax, in the part covered by the annulment, results from errors of fact and law attributable exclusively to the fiscal administration, insofar as the Claimant complied with its duty of declaration.
Indeed, it was demonstrated that the Claimant paid the disputed tax in an amount higher than what is due. In this manner and by force of the provisions of Articles 61 of the TCPT and 43 of the General Tax Law, the Claimant has the right to compensatory interest, which interest must be calculated from the date of payment of the undue (annulled) tax until the date of issuance of the respective tax credit note, the payment period for which begins on the date the period for voluntary compliance with this decision begins (Article 61, nos. 2 to 5, of the TCPT), all at the rate determined in accordance with the provisions of no. 4 of Article 43 of the General Tax Law.
In light of all the foregoing and the legal provisions invoked, it is decided in favor of the Claimant's request.
I - DECISION
Therefore, in light of all the foregoing, this Arbitral Tribunal decides:
To find procedurally admissible the request for a declaration of illegality of the tax assessment act for Municipal Property Tax no. 2009..., relating to the fiscal year 2009, in the total amount of €8,494.37 (eight thousand four hundred and ninety-four euros and thirty-seven cents).
To condemn the Respondent to return to the Claimant that amount unduly assessed and paid, plus the payment of compensatory interest already accrued relating to the period between the date of payment of the tax and its return, as well as the payment of accruing compensatory interest from the date of notification of this decision until full and complete payment, all in accordance with nos. 2 to 5 of Article 61 of the TCPT, at the legal rate determined in accordance with the provisions of no. 4 of Article 43 of the General Tax Law until full reimbursement.
The value of the case is fixed at €8,494.37, corresponding to the value of the assessment taking into account the economic value of the case, ascertained by the value of the tax assessment challenged, and accordingly the costs are fixed in the respective amount at €918.00 (nine hundred and eighteen euros), to be borne by the Respondent in accordance with Article 12, no. 2 of the Tax Arbitration Regime, Article 4 of the RCPAT and Table I attached to the latter. – no. 10 of Article 35, and nos. 1, 4 and 5 of Article 43 of the General Tax Law, Articles 5, no. 1, paragraph a) of the RCPT, 97-A, no. 1, paragraph a) of the TCPT and 559 of the Code of Civil Procedure).
Notify.
Lisbon, 31 August 2018
The Arbitrator
Rita Guerra Alves
Text prepared by computer, in accordance with the provisions of Article 138, no. 5 of the Code of Civil Procedure (CPC), applicable by reference from Article 29, no. 1, paragraph e) of the Tax Arbitration Regime.
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