Summary
Full Decision
ARBITRAL DECISION
Report
A - General
A..., S.A., with unique registration number and collective person number ..., with registered office in ..., ..., ..., ...-... Lisbon (hereinafter referred to as "Claimant"), filed on 01.03.2017, a request for establishment of a singular arbitral tribunal in tax matters, which was accepted, seeking, on one hand, in mediate terms, the declaration of illegality of the act of assessment of Stamp Tax relating to the year 2015, concerning item 28.1 of the General Table of Stamp Tax (hereinafter "GTST"), relating to a real property of which it is the owner, as will be seen more clearly below, and which gave rise to collection notices no. 2016..., no. 2016... and no. 2016..., concerning the first, second and third installments, respectively, in the total amount of € 29,069.45 (twenty-nine thousand and sixty-nine euros and forty-five cents), and on the other hand, the recognition of the right to compensatory interest for the payment of undue tax installments.
Pursuant to the provisions of paragraph a) of no. 2 of article 6 and paragraph b) of no. 1 of article 11 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 of the Administrative Arbitration Centre (CAAD) designated the undersigned as arbitrator, and the Parties, after being duly notified, did not manifest any opposition to this designation.
By order of 14.03.2017, the Tax and Customs Authority (hereinafter referred to as "Respondent") proceeded with the designation of Ms. Dr. B... and Dr. C..., who signs as C..., to intervene in the present arbitral proceedings, in the name and representation of the Respondent.
In accordance with the provisions of paragraph c) of no. 1 of article 11 of Decree-Law no. 10/2011, of 20 January, as amended by article 228 of Law no. 66-B/2012, of 31 December, the arbitral tribunal was constituted on 17.05.2017.
On the same day, 17.05.2017, the highest-ranking official of the Respondent's service was notified to, if desired, present a response within 30 days and request additional evidence production.
On 08.06.2017, the Respondent presented its response.
B – Position of the Claimant
The Claimant is the owner of the urban real property, which is a "land for construction", located on Rua ..., parish of ..., municipality of Lisbon, registered in the respective real estate register under article ..., with a tax value of assets (hereinafter "TVA") of € 2,906,945.26 (two million nine hundred and six thousand nine hundred and forty-five euros and twenty-six cents), to which corresponds the property card that the Claimant attaches to its request as document no. 5, the contents of which are considered reproduced (hereinafter referred to as "Property").
The Respondent, on 05.04.2016, proceeded with the assessment of Stamp Tax (hereinafter referred to as "ST") referred to in 1.1., whose collection documents relating to the first, second and third installments were attached to the request for arbitral opinion as documents nos. 2 to 4, the contents of which are considered reproduced, which was based on article 1 of the Stamp Tax Code (hereinafter the "STC") and on item 28.1 of the GTST.
The Claimant proceeded to pay the first, second and third installments of the ST referred to above on 29.04.2016, 09.08.2016 and 30.11.2016, respectively, the first in the amount of € 9,689.83 (nine thousand six hundred and eighty-nine euros and eighty-three cents) and the following in the amount of € 9,689.81 (nine thousand six hundred and eighty-nine euros and eighty-one cents) each.
On 26.08.2016, the Claimant reacted against the said assessment of ST, presenting a Gracious Complaint, and was notified of its dismissal on 10.01.2017.
The Claimant alleges that the Assessment now contested is unconstitutional, firstly for violation of the principle of tax equality (articles 12 and 13 of the Constitution of the Portuguese Republic ("CPR")), which prevents discrimination against taxpayers in equal or similar situations, with the fiscally relevant criterion being that of contributory capacity.
It appears to the Claimant that there is no plausible justification for the negative discrimination that affects land for construction with residential use and tax value equal to or greater than € 1,000,000.00 (one million euros) when compared with built-up real properties, under a regime of vertical or horizontal ownership, whose value of each of the units susceptible to independent use or autonomous fractions does not exceed that threshold, but which together show a value exceeding it.
Furthermore, the Property is not a manifestation of wealth of the Claimant, as it only integrates the production process undertaken by it, it not being reasonable to fiscally penalize companies engaged in real estate promotion compared to companies pursuing other types of activity, a conclusion all the more evident given that under the Municipal Property Tax (MPT), a special taxation regime for land for construction was created, favoring it when integrated into a production process.
Moreover, it appears that there is also no plausible justification for conceiving a tax regime that intends to negatively differentiate land for construction for residential purposes from land intended for other types of buildings.
Furthermore, in the present case, in addition to the aforementioned unconstitutionalities, we also have that which arises from the existence of inadmissible double taxation, since the Property, being already subject to MPT, now becomes equally subject to ST, with both taxes having an identity of fact: ownership.
The compensatory interest requested is due, as the Claimant paid tax installments which it considers illegal.
C – Position of the Respondent
The Respondent believes that the Assessment contested results from the direct application of the legal norm, fully respecting its letter and its spirit.
There is no double taxation, as two different taxes are involved: MPT and ST.
Neither is there unconstitutionality, for violation of the principle of equality, in the aspect of contributory capacity, since this does not prevent, in absolute terms, any differentiation of treatment. It only prohibits the occurrence of arbitrary and unjustified discriminations, having the legislator chosen, in a rational and objective manner, a certain factual presumption as the basis of incidence: land for construction with tax value superior to € 1,000,000.00 (one million euros) having as sole or predominant destination residential use.
D – Conclusion of the Report and Clarification
By order of 15.09.2017, the Arbitral Tribunal dispensed with the meeting provided for in article 18 of the Legal Regime of Arbitration in Tax Matters (LRATM), considering that the Parties had already provided to the proceedings the factual elements necessary and sufficient for pronouncing the decision, which was foreseen could take place until 31.10.2017, with a deadline offered for submission of written and successive arguments.
The Claimant presented its written arguments on 25.09.2017, and the Respondent presented its arguments on 04.10.2017, which reiterate what was already advocated by each of the parties in the documents previously presented by them.
The arbitral tribunal is materially competent, pursuant to the provisions of article 2, no. 1, paragraph a) of the LRATM.
The Parties have personality and judicial capacity and have standing pursuant to article 4 and no. 2 of article 10 of the LRATM, and article 1 of Ordinance no. 112-A/2011, of 22 March.
The cumulation of claims (declaration of illegality of assessment act, on one hand, and recognition of the right to compensatory interest, on the other) made in the present request for arbitral opinion, in homage to the principle of procedural economy, is justified since article 3 of the LRATM, by expressly admitting the possibility of "cumulation of claims even if relating to different acts", accommodates, without interpretative abuse, the consideration of a claim that derives, in necessary terms, from the judgment that the arbitral tribunal sustains as to the validity of the assessment called into question.
The proceedings do not suffer from any nullity nor were any exceptions invoked, and so one can proceed immediately to consideration of the merits of the case.
Matters of Fact
2.1. Proved Facts
The Claimant has corporate purpose related to the civil construction industry, construction of real properties for sale, purchase and sale of urban and rural real properties, urban development and subdivisions, real estate promotion, management of own real properties, representations and consignment of articles and materials for civil construction. (article 7 of the request for arbitral opinion).
The Claimant is the sole owner of the Property (doc. no. 5, attached with the request for arbitral opinion).
The Property was assigned the type of location coefficient: residential (doc. no. 5, attached with the request for arbitral opinion).
The Property was assigned the tax value of assets of € 2,906,945.26 (two million nine hundred and six thousand nine hundred and forty-five euros and twenty-six cents) (doc. no. 5, attached with the request for arbitral opinion).
The Property is land for construction whose building, authorized or planned, is for residential purposes, pursuant to the provisions of the Municipal Property Tax Code (consensus of the Parties).
The Claimant was notified of the collection documents relating to the act of assessment of ST for 2015, concerning item 28.1 of the GTST, relating to the Property, in the total amount of € 29,069.45 (twenty-nine thousand and sixty-nine euros and forty-five cents) (docs. nos. 2 to 4, attached with the request for arbitral opinion).
The Claimant proceeded to pay the first, second and third installments of the ST referred to above on the dates indicated in docs. nos. 2 to 4, attached with the request for arbitral opinion).
2.2. Unproved Facts
No further facts relevant to the consideration of the merits of the case were proven.
2.3. Grounds for Fixing the Matters of Fact
The facts were proven on the basis of the documents submitted to the record by the Parties and the positions assumed by them in the documents presented.
Matters of Law
3.1. Questions to be Decided
It follows from what has been said above that the questions to be considered are, fundamentally, two:
Whether it is materially unconstitutional, for violation of the principles of equality, contributory capacity and prohibition of double taxation, item 28.1 of the GTST, when it intends to apply to land for construction with tax value equal to or superior to € 1,000,000.00 (one million euros) owned by companies engaged in real estate promotion activities when it concerns the construction of buildings intended for residential purposes in which none of the future autonomous fractions or parts susceptible to independent use are foreseen to have a tax value equal to or superior to that amount; and
Whether, should the request for declaration of illegality and consequent annulment of the contested assessment act be judged admissible, the Claimant, within the scope of the present arbitral proceedings, may obtain the condemnation of the Respondent to pay compensatory interest relating to the amounts paid by it to satisfy the tax installments illegally demanded by the latter.
3.2. Item 28.1 of the GTST in the Wording Resulting from Law no. 55-A/2012, of 29 October
Law no. 55-A/2012, of 29 October, among various amendments it made to the STC, added, by its article 4, item 28 to the GTST, which had, until 31.12.2013, the following wording:
"28 - Ownership, usufruct or right of superficies of urban real properties whose tax value of assets contained in the register, pursuant to the Municipal Property Tax Code (MPTC), is equal to or superior to € 1,000,000 - on the tax value of assets used for purposes of MPT:
28.1 - Per real property with residential use - 1%;
As can be seen, item 28.1, with that wording, referred to "real properties with residential use". Now, not only is this concept not defined in any provision of the STC, but it is also not used in the MPTC, regulation to which article 67, no. 2 of the STC expressly refers when matters not regulated in the STC are at issue regarding item 28.
3.3. The Meaning and Scope of the Concept of "Real Property with Residential Use"
The meaning and scope of the concept of "real property with residential use" cannot be fixed without keeping in mind the meaning of the word "use" itself. And that must be found in dictionaries, gathering from them the benefit of the careful study of lexicographers. Thus, "use" (afectação), according to the Dictionary of Contemporary Portuguese Language, of the Academy of Sciences of Lisbon, is the action of designating something for a certain use, and "to use" (afectar), consequently, is synonymous with designating for a specific use or function.
The Rules of Interpretation of Tax Norms
The question that first needed to be answered did not exempt, but rather required, that the meaning and scope of the concept of "real property with residential use" to which item 28.1 of the GTST referred be captured. In the absence of a legal definition, either in the STC or in any other regulation, the interpreter-applicant of this provision has the duty to invoke the rules governing the necessary hermeneutical exercise.
There is not truly a special regime for the interpretation of tax norms. Article 11, no. 1 of the General Tax Code orders that the observation be made, "in determining the meaning of tax norms and in qualifying the facts to which they apply," of "the general rules and principles of interpretation and application of laws."
The general principles of interpretation and application of laws are those established in article 9 of the Civil Code:
ARTICLE 9
(Interpretation of the Law)
1. Interpretation must not be limited to the letter of the law, but must reconstruct from the texts the legislative thought, taking into account above all the unity of the legal system, the circumstances in which the law was drawn up, and the specific conditions of the time in which it is applied.
2. However, the interpreter cannot consider the legislative thought that does not have in the letter of the law a minimum of verbal correspondence, even if imperfectly expressed.
3. In fixing the meaning and scope of the law, the interpreter shall presume that the legislator adopted the most correct solutions and knew how to express its thought in adequate terms.
It should be noted, however, that the interpretation of norms, including tax norms, is not exhausted in a merely lexical exercise. It does not involve only, and not even principally, verbal dissection. The issue was not, therefore, to know exactly what "real property with residential use" meant, but rather to capture the meaning and scope of that concept within the scope of what item 28.1 of the GTST provided. The same is to say, it should be emphasized, that there would be procedural utility to the hermeneutical effort, within the scope of this specific request for arbitral opinion, only if it were directed at discovering whether the legislator, with the wording then chosen for item 28.1 of the GTST, intended to encompass within it urban real properties with the characteristics of the Property.
"Residential Use" – Residential Real Properties and Real Properties with Residential Use
The use of real property is a coefficient that contributes to its evaluation, as the Respondent well recalls. However, it mattered to know whether item 28 of the GTST, in the wording in force in 2012 and 2013, comprised both built-up real properties and those considered land for construction.
Article 6, no. 1 of the MPTC, with taxonomic concern, distinguishes "residential real properties" from "land for construction." The former shall be, pursuant to the provisions of no. 2 of the same article, buildings or structures licensed for that purpose or, in the absence of that license, those having that purpose as their normal destination. Land for construction, as clarified in no. 3 of the provision to which we have been referring, are those for which a building or construction license or authorization has been granted, prior communication admitted, or favorable prior information issued for a subdivision or construction operation, and also those thus declared in the acquisition title, with some exceptions.
It is therefore clear that land for construction is not, according to this classification, a residential real property. It still mattered to clarify the question of whether "real property with residential use," the concept then used by item 28.1 of the GTST, corresponded, despite the literal diversity, to "residential real property," the notion used in the classification just visited.
Use, from what we have learned from lexicographers, invokes the destination given to a certain property. "Residential" is relative to residence, which is, in turn, according to the Dictionary we have been using, a place or house in which one lives or dwells. Now, residential use cannot suggest another meaning than the action of giving to a certain property – in the case the Property, even if for these purposes it is admitted to be land for construction – the destination of a house or place where one dwells.
It is known that the MPTC uses the expression "use" in various provisions. It does so, for example:
In article 3, when it refers, relating to rural real properties, to a use generating agricultural income;
In article 9, when it imposes on taxable persons the duty to communicate to the finance services that land for construction has passed to figure in the inventory of a company whose purpose is the construction of buildings for sale or that a real property has passed to figure in the inventory of a company whose purpose is its sale;
In article 27, when it relates certain buildings and constructions to the generation of agricultural income.
In all the situations presented, as can be seen, use is not referred to in potential terms, of vocation or of expectation. It is just the opposite. It suggests an actual or direct destination, to use an expression that the legislator resorts to in article 27.
However, the MPTC also makes abundant use of the expression "use" when it enunciates the rules that should apply to the determination of the tax value of assets of urban real properties (articles 38 et seq. of the MPTC). Could some useful element be extracted from the rules for determining the tax value of assets that would allow us to capture the meaning and scope of the concept of "real property with residential use"?
The Relevance of the Rules for Determining Tax Value of Assets
The notion of use of urban real property is grounded in the part relating to the evaluation of real properties. For purposes of determining the tax value of assets of land for construction, the application of the use coefficient in the evaluation is clear.
It is certain that for the determination of the tax value of assets of real properties, "use" of what may be built on them has been taken into account.
The mere establishment of a right of potential construction immediately increases the value of the real property in question, as a function, precisely, of what may be built on it. Therefore, article 45 of the MPTC "orders the separation of the two parts of the land": on one side, we must consider "the part of the land where the building to be constructed will be implanted [more accurately, where the building that may be constructed can be implanted], and on the other the area of free land. Once the amount of the first part is determined, the value determined is reduced to a percentage between 15% and 45% (...), due to the construction not yet being effectuated." It is clear that the application of that percentage allows precisely accounting for the circumstance of construction not yet existing, but does not authorize the legislator to ignore that the economic or market value of a piece of land is related to its construction capacity.
Stating what precedes does not mean, however, asserting that the legislator feels the need to impose automatic and necessary taxation, under the Municipal Property Tax, to all land. It suffices to read what paragraph d) of article 9 of the MPTC provides:
ARTICLE 9
(Beginning of Taxation)
The tax is due from:
(...)
The fourth year following, inclusive, that in which land for construction has passed to figure in the inventory of a company whose purpose is the construction of buildings for sale;
(...)
That is, even if the legislator considers it reasonable, as it appears to be, to determine the tax value of assets of land taking into account its construction capacity and, let us concede for the sake of argument, the nature or vocation of what may be built on it, it is nonetheless symptomatic that it has opted, at the same time, to suspend that taxation in cases in which such land figures in the inventory of a company whose purpose is the construction of buildings for sale. In cases in which, one could also say, those urban real properties integrate a production process that tends to continue and to produce, downstream, fruits also subject to taxation.
If the primary meaning of "use," as we have stated, suggested an actual, direct destination given to a certain property, we do not see how this understanding could be contradicted by the finding that the legislator, in the context of evaluating land for construction, authorizes the use of the use coefficient, having in view what may be built on it. In truth, it did not seem reasonable to admit in this scenario the recourse to rules for determining taxable matter to broaden the forecast of the incidence rules.
In light of the foregoing, proper interpretation of the provisions of item 28.1 of the GTST in the wording applicable to the years 2012 and 2013 required the understanding that residential use of an urban real property suggested that it be given that actual destination, or that it could be directly given that destination.
It should not be said that this judgment collides with the possibility of having the use coefficient to which reference is made in Section II of Chapter VI of the STC applied to land for construction. In truth, one thing is the rules that the legislator imposes to determine the tax value of assets of land for construction, it not being strange that its construction capacity and the nature and vocation of what may be built on it be taken into account, another, quite different, is to claim that those rules be invoked to define the field of the normative forecast of the incidence rules.
Moreover, the interpretation that we adopt here, and widely supported by judicial and arbitral jurisprudence, is in accordance with what appears to have been the intention of the Government, author of the proposal that resulted in this poorly executed legislative intervention.
When presenting and discussing, in Parliament, bill proposal no. 96/XII (2nd), the Secretary of State for Tax Affairs expressly stated:
"The Government proposes the creation of a special rate on high-value urban residential real properties. This is the first time that in Portugal a special taxation is created on high-value properties intended for residential use. This rate will be 0.5% to 0.8% in 2012 and 1% in 2013, and will apply to houses with a value equal to or superior to 1 million euros."
Now, the Secretary of State for Tax Affairs presented this bill proposal referring to the expressions "urban residential real properties," which are those contained in paragraph a) of no. 1 of article 6 of the STC and, as the Respondent well notes, "houses," it being manifest that, in either case, land does not, without more, fit within these concepts, even if for construction.
Thus, despite the poor legislative technique and without prejudice to the subsequent wording, it resulted with crystal clarity that item 28.1 of the GTST could not be interpreted to mean that real properties with the characteristics of the Property were encompassed therein, for the reasons stated above. Rather, it appears that the meaning and scope of the concept of "real properties with residential use" was equivalent to that of "residential real properties" mentioned in paragraph a) of no. 1 of article 6 of the STC.
3.4. Item 28.1 of the GTST in the Wording Given by Law no. 83-C/2013, of 31 December
With the amendment introduced by Law no. 83-C/2013, of 31 December, item 28.1 of the GTST now reads as follows:
28.1 - Per residential real property or per land for construction whose building, authorized or planned, is for residential purposes, pursuant to the provisions of the Municipal Property Tax Code;
Let us therefore determine whether the Property, with respect to the assessment of ST for 2015, is encompassed by the incidence norm.
The parties agree that the Property is land for construction. Now, we have already examined no. 1 of article 6 of the MPTC, regarding the distinction between "residential real properties" and "land for construction," that is, those for which a building or construction license or authorization has been granted, prior communication admitted, or favorable prior information issued for a subdivision or construction operation, and also those thus declared in the acquisition title, with some exceptions, as is read in no. 3 of the same provision.
However, the concern of the norm-applying interpreter should not be limited to the concept of "land for construction." That exercise would be devoid of any utility if it ignored the incidence norm that summons it.
In truth, more than knowing whether the Property is or is not land for construction, which is indisputed, it matters to discover, in a first moment, whether the Property is, for purposes of item 28.1 of the GTST, "land for construction whose building, authorized or planned, is for residential purposes, pursuant to the provisions of the Municipal Property Tax Code." This is the first point of analysis, with respect to the assessment for 2015.
It is not mere entry in the register as "land for construction" that carries the inevitable application of item 28.1 of the GTST, since it does not, by itself, constitute conclusive demonstration that a certain real property has building for residential purposes planned.
On this point, see JOSÉ MANUEL FERNANDES PIRES, (Lessons on Taxes on Property and Stamp Tax. Coimbra, Almedina, 3rd ed., 2015, pp. 110 to 112): "The right to construct is not inherent in the right of ownership, but arises ex novo in the owner's patrimony only when an administrative act by the competent public entity recognizes and authorizes the owner to construct or subdivide. [...] only when that right is established in the legal sphere of the owner is that the Municipal Property Tax Code establishes that we are faced with land for construction."
Thus, it appears clear that for verification of the normative forecast it is not sufficient mere entry in the register of a real property as land for construction designated for residential use, as the profile of the objective incidence now in question does not relinquish the demonstration of actual building potential, necessarily revealed by the existence of documentary supports that authorize it. The same is to say that the incidence of the tax, for purposes of item 28.1 of the GTST, only materializes, and even then not in definitive or complete terms, with the verification of "actual use," to use the felicitous expression of JOSÉ MANUEL FERNANDES PIRES (ob. cit., p. 507). In the same sense, see, among others, the CAAD Award rendered in case no. 524/2015-T.
Now, without demonstration of that actual building potential, item 28.1 of the GTST does not appear applicable. However, for purposes of application of item 28.1 of the GTST, that actual building potential is not sufficient. It is necessary to prove that the building, authorized or planned, is for residential purposes. The same is to say that it cannot be for a purpose other than residential, as, in our view, building for commerce or industry would not give rise to application of the norm to which we have been referring.
However, the Claimant does not even dispute this aspect. It does not follow from what the Claimant has sustained that the building, authorized or planned, on the Property has any purpose other than residential, pursuant to the provisions of the Municipal Property Tax Code.
Thus, the problem must be posed of whether it is materially unconstitutional, for violation of the principles of equality, contributory capacity and prohibition of double taxation, item 28.1 of the GTST, when it intends to apply to land for construction with tax value equal to or superior to € 1,000,000.00 (one million euros) owned by companies engaged in real estate promotion activities when it concerns the construction of buildings intended for residential purposes in which none of the future autonomous fractions or parts susceptible to independent use are foreseen to have a tax value equal to or superior to that amount.
3.5. Material Unconstitutionality of Item 28.1 of the GTST
The Claimant holds that item 28.1 of the GTST, in the interpretation the Respondent makes of it, violates the constitutional principles of equality, contributory capacity and prohibition of double taxation.
However, as has been seen, by summary decision no. 610/2018, rendered on 18.09.2018, the Constitutional Court, considering an appeal filed by the Respondent and by the Public Ministry, came to decide in favor of the non-unconstitutionality of the norm contained in Item 28.1 of the General Table of Stamp Tax, in the wording given by Law no. 83-C/2013, of 31 December, insofar as it imposes annual taxation on the ownership of land for construction whose building, authorized or planned, is for residential purposes, whose tax value is equal to or superior to € 1,000,000.00 (one million euros).
Furthermore, it is precisely that judgment of non-unconstitutionality that requires the reform of the decision rendered by this Arbitral Tribunal on 27.10.2017, since it was based, following what was advocated by the Claimant, on the unconstitutionality of that same provision, with the grounds then invoked. Thus, the Arbitral Tribunal has no alternative but to judge that the arguments that militated in favor of unconstitutionality lack here, pronouncing a decision that does not set aside the application of Item 28.1 of the General Table of Stamp Tax, in the wording given by Law no. 83-C/2013, to the case that it is necessary to consider. This means that the assessment in the present record called into question does not suffer from any defect, conforming as it does to the applicable legal norms.
3.6. Compensatory Interest
Paragraph b) of no. 1 of article 24 of the LRATM provides that "the arbitral decision on the merits of the claim against which no appeal or challenge may lie binds the tax administration from the end of the period established for appeal or challenge, the latter having to, in the exact terms of the grounding of the arbitral decision in favor of the taxpayer and until the end of the period established for spontaneous execution of judgments of the tax courts, restore the situation that would have existed if the tax act that was the subject of the arbitral decision had not been performed, adopting the acts and operations necessary for that purpose."
It is not ignored that the legislative authorization granted to the Government by article 124 of Law no. 3-B/2010, of 28 April, on the basis of which the LRATM was approved, determines that the tax arbitral process constitutes an alternative procedural means to the judicial challenge process and to the action for recognition of a right or legitimate interest in tax matters. Although paragraphs a) and b) of no. 1 of article 2 of the LRATM establish the competence of the arbitral tribunals in "declarations of illegality," it seems reasonable the understanding that within their competencies are understood the powers that in judicial challenge proceedings are attributed to the tax courts, it being certain that in judicial challenge proceedings, in addition to the annulment of tax acts, claims for compensation may be considered, especially relating to compensatory interest.
Indeed, the principle of cognizability of compensation claims, in gracious complaint or judicial proceedings, is justified whenever the damage that is sought to be compensated results from fact attributable to the Tax and Customs Authority. We find manifestations of this principle in no. 1 of article 43 of the General Tax Code and in article 61 of the Tax Procedure and Process Code.
Thus, consideration of the Claimant's request for payment of compensatory interest is justified.
As the assessment in the present record called into question does not suffer from any invalidity, no compensatory interest is naturally due, as there has been no payment of tax debt in an amount superior to that legally due.
Decision
In the terms and with the grounds exposed, the arbitral tribunal decides:
To judge the request for arbitral opinion to be totally without merit, with the assessment contested remaining in the legal order;
To judge equally without merit the request for condemnation of the Respondent to pay compensatory interest.
Value of the Case
In accordance with the provisions of no. 2 of article 306 of the Code of Civil Procedure, article 97-A of the Tax Procedure and Process Code, and also no. 2 of article 3 of the Regulations on Costs in Tax Arbitration Proceedings, the value of the case is fixed at € 29,069.45 (twenty-nine thousand and sixty-nine euros and forty-five cents).
Costs
For the purposes of the provisions of no. 2 of article 12 and no. 4 of article 22 of the LRATM and no. 5 of article 4 of the Regulations on Costs in Tax Arbitration Proceedings, the amount of costs is fixed at € 1,530.00 (one thousand five hundred and thirty euros), pursuant to Table I attached to said Regulations, to be borne entirely by the Claimant.
Lisbon, 29 April 2019
The Arbitrator
_______________________________
(Nuno Pombo)
Document prepared on computer, pursuant to no. 5 of article 131 of the Code of Civil Procedure, applicable by reference from paragraph e) of no. 1 of article 29 of Decree-Law no. 10/2011, of 20 January, and in accordance with the orthography prior to the said Orthographic Agreement of 1990.
[1] See DAR Series I, no. 9/XII -2, of 11 October, p. 32.
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