Summary
Full Decision
ARBITRAL DECISION
I. - REPORT
A - PARTIES
A A…, SA, designated as "Claimant", with registered office at Rua …, … - Lisbon, with the collective person number …, challenging party in the tax procedure above referenced, came, invoking the provisions of article 10 of Decree-Law no. 10/2011, of 20 January (hereinafter RJAT), to request the establishment of a singular arbitral tribunal, with a view to adjudicating the following claim pitting it against the Tax Authority and Customs Authority, hereinafter designated as "Respondent" or "TA".
B - CLAIM
1 - The request for the establishment of the Arbitral Tribunal was accepted by the Esteemed President of CAAD on 16-03-2017 and notified to the Tax Authority and Customs Authority (TA) on 24-03-2017.
2 - Pursuant to the provisions of article 6, no. 1 and article 11, no. 1, subparagraph a) of Decree-Law no. 10/2011, of 20 January, the Deontological Council designated, on 11-05-2017, as sole arbitrator António Manuel Correia Valente, who communicated acceptance of the appointment.
3 - On 11-05-2017 the Parties were notified of such designation, pursuant to the combined provisions of article 11, no. 1, subparagraph b) of the RJAT, in the wording introduced by article 228 of Law no. 66-B/2012, of 31 December, and articles 6 and 7 of the Deontological Code, with the parties having shown no willingness to refuse the arbitrator's designation.
4 - In these circumstances, in conformity with the provisions of article 11, no. 1, subparagraph c) of Decree-Law no. 10/2011, of 20 January, in the wording introduced by article 228 of Law no. 66-B/2012, of 31 December, the arbitral tribunal was regularly established on 26-05-2017.
5 - On 15 September 2017, the Arbitral Tribunal, under article 16, subparagraph c) of the RJAT (Decree-Law no. 10/2011, of 20 January), and taking into account the content of the order issued on 05 September 2017, deemed dispensable the holding of the meeting provided for in article 18 of the said legal instrument.
6 - The Claimant herein requests that the present Arbitral Tribunal:
a) - Declare the illegality and consequent annulment of 56 assessments relating to the Single Circulation Tax (hereinafter designated as IUC) and the associated compensatory interest (CI) pertaining to the years 2011 to 2014, as identified in the case file, relating to the 56 vehicles, equally identified in the case file, which are hereby deemed to be fully reproduced;
b) - Declare the illegality of the order of 13-12-2016 of the Director of the Large Contributors Unit of the TA, which rejected the request for official review of said assessments, identified under no. …2016…;
c) - Condemn the TA to reimburse the sum of €6,000.32, corresponding to the total amount paid as IUC and CI, relating to the years and vehicles aforementioned;
d) - Condemn the Tax Authority and Customs Authority to payment, both of compensatory interest relating to amounts unduly assessed and paid, and of the costs of the proceedings.
C - CAUSE OF ACTION
7 - The Claimant, in support of its request for arbitral adjudication, alleges, in summary, the following:
8 - That it is a company dedicated to the sale of automobiles, their parts and accessories, having in the exercise of its activity the exclusive right to import, into Portugal, motor vehicles of the B… brand.
9 - That it was recipient of 56 assessments of IUC and CI, the amount of which, in the value of €6,000.32, it paid, having proceeded to the filing of a request for official review of such assessments, which, by order of 13-12-2016 of the Director of the Large Contributors Unit of the TA, was rejected.
10 - That, after importation, all motor vehicles are immediately sold to dealerships of said brand, which, in turn, sell them to final customers.
11 - That the motor vehicles cease, from the said importation onwards, to be in its possession or ownership, not entering the road traffic in its interest, but rather in the interest of said final customers, on whose account they actually enter road traffic.
12 - That, although from a strictly formal point of view the registration and registration of the motor vehicles is done in its name, it is certain that it is the dealerships who request the registration of the vehicles, as they become available for delivery and have customers.
13 - That the invoices for the sale of the motor vehicles contain only the chassis numbers and not an indication of the registration numbers, given that they are sold and invoiced prior to the dates relating to the assignment of the said registration numbers.
14 - That only the invoices relating to the ISV debits to the dealerships, which occurs after the dates of the invoices for the sale of the corresponding vehicles to such dealerships, contain the registration numbers and their respective dates, which, in light of the coincidence of the chassis number, is verifiable by the interconnection between some and other of such invoices.
15 - That all the sales invoices in question were within the official knowledge of the TA, because they were duly communicated to the TA via SAF-T, whereby the TA had official knowledge of the date of the sales of the vehicles in question, as well as of the respective final customers.
16 - That, having the status of registered operator and being responsible for introducing the vehicles into consumption, it is a passive subject of the ISV (see article 5 of the CISC), which is not the case with respect to the IUC, given that the vehicles in question were, by it, sold prior to the dates of their respective registrations, not being then its proprietor, not being, consequently, subject to the said IUC.
17 - That within the framework of the CIUC, the legislator makes the ISV incur at the phase of registration of the vehicle and the IUC at the phase of circulation of the vehicle, which results from the very designation of the taxes in comparison.
18 - That the sales of the vehicles, by it effected to the dealerships, occur precisely on the dates of the issuance of the invoices, which evidences such sales, with the price being paid on the day immediately following the dates of such invoices, which, in particular, results from the express reference to "Due Date - Immediate Payment" set forth in such invoices.
19 - That in the CIUC, in light of the provisions of its article 1, the "Principle of Equivalence" prevails, according to which the single circulation tax follows the principle of equivalence, seeking to burden taxpayers in the measure of the environmental and road cost provoked by vehicles, within the framework of their effective use.
20 - That the IUC does not aim to tax importers or dealers of vehicles, for the simple reason that, being they not the users of the vehicles, they do not produce any environmental and road cost, not being, consequently, the polluters that the legislator intended to tax.
21 - That it is unanimous jurisprudence of CAAD the understanding that article 3, no. 1 of the CIUC establishes a legal presumption iuris tantum (and not iure et de iure), susceptible to proof to the contrary.
22 - That although the Claimant appeared in the Motor Registry and with the IMTT as proprietor of the vehicles, reality likewise shows that on the dates of registration of the vehicles in question the Claimant was no longer its proprietor, by reason of the fact that they had already been sold to the dealerships.
23 - That the documents/invoices presented as evidence of the transfer of ownership of the vehicles in question, in addition to enjoying the presumption of truthfulness, in light of the provisions of article 75, no. 1 of the LGT, rebut the presumption established in article 3, no. 1 of the CIUC of ownership of the vehicles.
24 - That, in accordance with what is established in article 17 of the CIUC (deadline for assessment and payment) which states "1 - In the year of registration of the vehicle in national territory, the tax is assessed by the passive subject of the tax within 30 days following the end of the deadline legally required for its respective registration. 2 - In subsequent years the tax must be assessed by the end of the month in which it becomes due, pursuant to no. 2 of article 4. (…)".
25 - That, pursuant to the combined provisions of article 42, no. 1 and no. 2 of the Motor Registry Regulation, approved by Decree-Law 55/75, of 12 February, the motor registry, in the case of initial registration of ownership, must be requested within the period of 60 days from the date of the assignment of the registration.
26 - That, in the case of the concrete vehicles identified in the official IUC assessments now in discussion, what is at issue is the IUC due with reference to the dates of the registrations, dates on which the vehicles in question were not its property, in that they had already been sold to third parties.
27 - That the TA, upon considering that the Claimant is the passive subject of the IUC in the year of registration of the vehicles in question only because the same would be registered in its name on the dates of the registrations, despite having in its possession elements that point in a different direction, causes the assessments of the single circulation tax in question to be founded on an erroneous interpretation and application of the rules of subjective incidence of the IUC, contained in article 3 of the CIUC, which constitutes the commission of tax acts lacking in legality due to error in the factual and legal assumptions.
D - RESPONDENT'S REPLY
28 - The Respondent, Tax Authority and Customs Authority, (hereinafter designated as TA), filed, on 27-06-2017, a Reply and proceeded to attach to the case file a copy of the Tax Administrative Procedure File.
29 - In said Reply, the TA understands that the assessments in question do not suffer from any defect of violation of law, pronouncing itself for the lack of merit of the claim and for the maintenance of the assessment acts questioned, defending, in summary:
30 - That all the arguments wielded by the Claimant, having no support in the letter of the law, stem from wrong premises, seeking by that means the application of a regime of exclusion from taxation without basis in the IUC.
31 - That, within the scope of article 17 of the Code of Tax on Vehicles - CISC, the introduction into consumption and assessment of tax on vehicles not possessing national registration, is evidenced by the issuance of a Customs Declaration of Vehicles - CDV, issuance which constitutes the taxable event, pursuant to the provisions of article 5 of the CISC.
32 - That, pursuant to the provisions of article 117, no. 4 of the Road Code, the registration of vehicles is requested from the IMTT by the entity that proceeds to its admission or introduction into consumption, and it is certain, on the other hand, that, in light of the provisions of article 24 of the Motor Registry Regulation (MRR), approved by Decree-Law no. 55/75, of 12 February, in the wording given by Decree-Law no. 178-A/2005, of 28 October, "The initial registration of ownership of imported vehicles, admitted, assembled, constructed or reconstructed in Portugal is based on the respective request and proof of compliance with fiscal obligations relating to the vehicle". (see articles 9 and 10 of the Reply)
33 - That, from the articulation of subjective incidence (article 3 of the CIUC) with the fact constitutive of the obligation of the tax (article 6 of the CIUC) follow the legal situations that generate the birth of the tax obligation, namely, the registration or the registration. (see article 14 of the Reply)
34 - That, in light of the provisions of article 6, no. 3 of the CIUC, the tax is considered due on the first day of the taxation period referred to in no. 2 of article 4, which means that the moment from which the tax obligation is constituted has a direct relationship with the issuance of the registration certificate, in which the facts subject to registration must appear.
35 - That, taking into account the provisions of article 24 of the Motor Registry Regulation and the aforementioned rules, the initial registration of ownership of admitted vehicles - as is the case in the present proceedings - is based on the respective request and proof of compliance with fiscal obligations relating to the vehicle, which means that the registration certificate implies the presentation of a CDV, by the Claimant and generates automatically, pursuant to article 24 of the MRR, the registration of the ownership of the vehicle in the name of the entity that proceeded to its importation and to the request for registration, namely, the Claimant, which means that the first registration of each vehicle is effected in the name of the importing entity, in this case the Claimant. (see articles 17 to 21 of the Reply)
36 - That the argumentative approach followed by the Claimant finds no minimum correspondence with the ratio legis contained in article 6 of the CIUC, nor with the legislative intent.
37 - That the tax legislator did not stipulate that the tax would be due by the proprietor of the vehicle that was registered in the 60 days to which no. 2 of article 42 of the MRR alludes, tax that would be paid in 30 days, pursuant to article 17 of the CIUC. (see article 33 of the Reply)
38 - That the tax legislator also did not stipulate that importers may be excluded from subjective incidence in the context of the IUC, should they proceed to the sale of vehicles prior to the assignment of the registration certificate.
39 - That, what is legally established establishes that the taxable event of the tax is measured by the registration or by the registration, with article 24 expressly providing that, with the ISV having been paid and registration requested, the vehicle is automatically registered in the name of the importer, that is, of the Claimant, with it being required to pay the IUC, pursuant to article 3 of the CIUC. (see nos. 36 and 37 of the Reply)
40 - That, with the vehicles being registered in the name of the Claimant, the tax is required of it pursuant to articles 3 and 6 of the CIUC, it being impossible to set aside the subjective incidence of the tax. (see no. 46 of the Reply)
41 - That, with the Claimant, as importer of the vehicles, being the one who requested the request for assignment of registration and appearing as proprietor of the vehicle, it fulfills the incidence norm, being a passive subject of the tax.
42 - That, with the vehicles having been registered in the name of the Claimant and the introduction of the vehicles into consumption having been effected, it fulfills the taxable event of the tax (objective/subjective incidence), with its payment being required of it pursuant to article 3 of the CIUC.
43 - That article 18 of the CIUC came to establish as a rule the subjection to tax of the passive subject that filed the customs declaration and requested the issuance of the registration, if the vehicle is not registered in the name of another within the period of 60 days to which the provision of article 42 of the MRR alludes plus the deadline for assessment and payment established in article 17 of the CIUC.
44 - That the invoices presented by the Claimant, as a means of setting aside taxation by way of subjective incidence and the registration presumption, are not apt to prove the execution of a synallagmatic contract such as is the purchase and sale, since such documents do not reveal by themselves an essential and unambiguous declaration of intent by the supposed acquirers.
45 - That the understanding propounded by the Claimant in order to set aside the subjective incidence and taxation of the IUC, in the case of sale of vehicles prior to the assignment of the registrations does not appear to be in conformity with the Constitution, violating the constitutional principles of legality and tax justice, of contributory capacity, of equality, of certainty and of legal security.
46 - That, it should be ruled that the claim for arbitral adjudication lacks merit, with the tax assessment acts impugned remaining in the legal order, absolving accordingly the Respondent entity of the claim.
E - QUESTIONS TO BE DECIDED
47 - It is therefore incumbent upon us to appreciate and decide.
48 - In light of the foregoing, regarding the positions of the Parties and the arguments presented, the principal questions to be decided are the following:
a) - Whether the rule of subjective incidence contained in article 3, no. 1 of the CIUC, establishes, or not, a presumption;
b) - What is the legal value of motor registration in the economy of the CIUC, particularly for purposes of the subjective incidence of this tax.
c) - Whether the passive subject of the IUC is the importer, whenever, in the case of imported vehicles, the sale of such vehicles occurs prior to the dates of assignment of the first registration.
d) - Whether the documents presented, relating to the vehicles identified in the proceedings, are apt to constitute proof of their respective sales.
F - PROCEDURAL ASSUMPTIONS
49 - The Arbitral Tribunal is regularly established and is materially competent, pursuant to article 2, no. 1, subparagraph a) of Decree-Law no. 10/2011, of 20 January.
50 - The Parties enjoy judicial personality and capacity, are legitimate and are legally represented (see article 4 and article 10, no. 2 of Decree-Law no. 10/2011 and article 1 of Ordinance no. 112/2011, of 22 March).
51 - The proceedings do not suffer from defects that would invalidate them.
52 - Having regard to the tax administrative proceeding (PA), a copy of which was remitted by the TA and the documentary evidence attached to the case file, it is now incumbent upon us to present the factual matter relevant to the understanding of the decision, which is established in the following terms.
II - GROUNDS
G - FACTUAL GROUNDS
53 - In factual matters relevant, this tribunal considers the following facts to be established:
54 - The Claimant is a commercial company dedicated to the sale of automobiles, their parts and accessories, having in the exercise of its activity the exclusive right to import, into Portugal, motor vehicles of the B… brand.
55 - The Claimant was recipient of the IUC and CI assessments identified in the proceedings, relating to the years 2011 to 2014, in the amount of €6,000.32, which it paid, having proceeded to the filing of a request for official review of such assessments, which, by order of 13-12-2016 of the chief of the Division of the Large Contributors Unit of the TA, was rejected, particularly on the ground, as appears from the PA, that the tax legislator, upon establishing in article 3, no. 1 of the CIUC, on whom the obligation of the IUC falls, intentionally and expressly wanted that those be considered as passive subjects of tax the proprietors, being considered as such the persons in whose name the vehicles are registered, which in the case of the present proceedings corresponds to the Claimant, the person in whose name the vehicles were first registered.
56 - The motor vehicles identified in the proceedings, after their importation/introduction, were sold to dealerships of said brand, sales that occurred on dates prior to those of the assignment of the registrations.
57 - The motor vehicles in question do not enter the road traffic in the interest of the Claimant, but rather in the interest of the final customers, on whose account they actually enter road traffic.
58 - The invoices for the sale of the motor vehicles identified in the proceedings contain only the chassis numbers and not an indication of their registrations, which are referenced in the correlative invoices relating to the (re)debits of the ISV to the dealerships.
59 - The initial registration of ownership of the vehicles in question in the proceedings was effected in the name of the Claimant, as importing entity, with their respective registrations being assigned after the sale of the vehicles.
GROUNDS FOR THE FACTS PROVED
60 - The facts considered proved are based on the documents mentioned with respect to each of them, and insofar as their correspondence with reality was not challenged.
FACTS NOT PROVED
61 - There are no facts considered as not proved, given that all the facts considered relevant for the adjudication of the claim were proved.
H - LEGAL GROUNDS
62 - The factual matter has been established, and it is now incumbent upon us to proceed to legal subsumption and determine the law applicable to the underlying facts, in accordance with the questions to be decided enunciated in no. 48.
63 - The first question, with respect to which there are absolutely opposed understandings between the Claimant and the TA, is translated into knowing whether the rule of subjective incidence contained in no. 1 of article 3 of the CIUC establishes or not a rebuttable presumption.
64 - The positions of the parties are known. In fact, for the Claimant, the provision of no. 1 of article 3 of the CIUC establishes a legal presumption iuris tantum (and not iure et de iure), that is, susceptible to proof to the contrary, while for the Respondent it is not possible to set aside the subjective incidence of the tax, whereby, with the vehicles initially registered in the name of the Claimant, it is that which, pursuant to articles 3 and 6 of the CIUC, is responsible for the payment of the tax.
65 - The question that it will be important, first of all, to know and decide consists in knowing whether the rule of subjective incidence contained in no. 1 of article 3 of the CIUC establishes, or not, a presumption susceptible to being rebutted.
I - INTERPRETATION OF THE RULE OF SUBJECTIVE INCIDENCE CONTAINED IN NO. 1 OF ARTICLE 3 OF THE CIUC
66 - On this question, that is, knowing whether the rule of subjective incidence contained in no. 1 of article 3 of the CIUC, establishes a presumption, it should be noted that the jurisprudence established in the CAAD points in the direction that said rule establishes a rebuttable legal presumption. In fact, from the first Decisions, issued on this matter, in the year 2013, among which may be mentioned, in particular, those issued in the framework of Proceedings nos. 14/2013-T, 26/2013-T and 27/2013-T, to the most recent of which may be indicated the Decisions issued in the scope of Proceedings no. 69/2015-T, no. 191/2015-T and no. 202/2015-T, passing through numerous Decisions issued in the year 2014, of which are mentioned, by way of mere example, the Decisions issued in Proceedings nos. 34/2014-T, 120/2014-T and 456/2014-T, all point to the understanding that no. 1 of article 3 of the CIUC establishes a rebuttable legal presumption.
With respect to this, it should also be mentioned the recent Decision of the Lisbon Tax Court, issued on 23-01-2017, in Proc. No. 463/13.4BELRS, where it is considered that the "[…] claimant succeeded in rebutting the presumption established in article 3, no. 1 of the CIUC."
It should further be considered the understanding set forth in the Judgment of the Central Administrative Court of the South, issued on 19-03-2015, Proceeding 08300/14, available at: www.dgsi.pt, which seconds said jurisprudence, when it therein expressly states that article 3, no. 1 of the CIUC "[…] establishes a legal presumption that the holder of motor registration is its proprietor, and that such presumption is rebuttable by force of article 73 of the LGT".
This is an understanding to which we fully adhere and which is given, without further ado, as valid and applicable in the present case, it not being considered, consequently, necessary other developments, given the abundant grounds set forth in the mentioned Decisions and in the said Judgment.
J - ON THE VALUE OF REGISTRATION
67 - Article 1, no. 1 of Decree-Law no. 54/75, of 12 February, relating to the registration of motor vehicles, establishes that "The registration of vehicles has essentially as its purpose to publicize the legal situation of motor vehicles and their trailers, with a view to the security of legal commerce". (underlining ours)
68 - Being clear, in light of said rule, what the purpose of the registration is, there is not, however, clarity, within the scope of said Decree-Law, on the legal value of such registration, it being important to consider article 29 of the mentioned legal instrument, relating to the registration of motor property, where it is provided that "With the necessary adaptations, the provisions relating to land registration are applicable to motor registration, […]". (underlining ours)
69 - In this framework, in order to be able to achieve the legal value of the registration of motor property, it is important to take into account what is established in the Land Registry Code, approved by Decree-Law no. 224/84, of 06 July, when it provides in its article 7 that "the definitive registration constitutes a presumption that the right exists and belongs to the registered owner in the precise terms in which the registration defines it". (underlining ours)
70 - The combination of the provisions of the aforementioned articles, that is, in no. 1 of article 1 of Decree-Law no. 54/75, of 12 February and in article 7 of the Land Registry Code, permits us to consider, on one hand, that the fundamental function of registration is to publicize the legal situation of vehicles, permitting, on the other hand, to presume that the right exists and that such right belongs to the owner in whose favor the same is registered, in the precise terms in which it is defined in the registration.
71 - Thus, definitive registration constitutes nothing more than the presumption that the right exists and belongs to the registered owner, in the exact terms of the registration, but a rebuttable presumption, admitting, therefore, evidence to the contrary, as follows from the law and jurisprudence has been pointing out, being able, for this purpose, to see, among others, the Judgments of the STJ nos. 03B4369 and 07B4528, respectively, of 19/02/2004 and 29/01/2008, available at: www.dgsi.pt.
72 - The function legally reserved to registration is, thus, on one hand, to publicize the legal situation of goods, in the case, of vehicles and, on the other, to permit us to presume that the right exists over such vehicles and that the same belongs to the owner, as such registered in the registration, which means that registration does not have a constitutive nature of the right of property, but only declarative, and such presumptions are rebuttable, either by force of what is established in no. 2 of article 350 of the Civil Code, or in light of the provision of article 73 of the LGT. Hence, from the moment in which the presumptions in question are set aside, by means of adequate proof, the TA will not be able to persist in considering as the passive subject of the IUC the person in whose name the vehicle remains registered.
L - EVIDENCE PRESENTED
73 - The means of proof presented are embodied in the invoices relating to the sale of the vehicles to the dealerships of the B… brand, as identified in the case file, it being important to note on the transfer of ownership of motor vehicles, that, not being legally required written form as proof of such transfer, the same may be accomplished by any means, in particular by way of testimonial or documentary evidence, in this latter being included, in particular, the invoices relating to the sales of the vehicles.
74 - With respect to invoices, as documentary evidence of the sale of motor vehicles, one cannot fail to take into account no. 2, article 2, of Decree-Law no. 177/2014, of 15 December, in the provision of which invoices are considered as documents that indicate the actual purchase and sale of vehicles.
75 - On the other hand, it is also important to recall the provision of subparagraph b) of no. 1 of article 29; in no. 5 of article 36 and in nos. 1 and 2 of article 40, all of the CIVA, in the wording introduced by Decree-Law no. 197/2012, of 24 August, from which it follows that only the invoice, the receipt-invoice and the simplified invoice embody documents recognized for purposes of the transfer of goods or the provision of services.
76 - The Claimant, as means of proof that it proceeded to the sale of the vehicles, as identified in the present proceedings, on a date prior to that of the exigibility of the tax, presented, for each vehicle, two correlated invoices, exhibiting in common, in particular, the identification of the same acquirer of the vehicle and the same chassis number of that same vehicle: one of them relating to the sale of the vehicle to the brand dealership; another relating to the (re)debit of the ISV associated with the vehicle sold, in which the corresponding registration is already referenced.
77 - It should, moreover, be emphasized that nothing permits one to consider that any of such documents, concretely the invoices presented, as support for the sale of each of the vehicles in question in the present proceedings, do not have correspondence with the sales that, allegedly, were effectuated.
78 - The invoices attached to the case file, as proof of the alienation of the vehicles, taking into account the business purpose of the Claimant, focused particularly on the exclusive right to import, into Portugal, motor vehicles of the B… brand and on the necessary sale of such vehicles to its customers, show themselves to be totally adjusted to the mentioned business reality, being absolutely plausible the sale of the vehicles that the invoices presented aim to prove, with no elements being identified that embody any simulated contract, rather permitting the conclusion that we are faced with invoices that reflect the real and true sale of the vehicles to the persons indicated therein.
79 - The concatenation of the aforesaid documents (two invoices for each vehicle) presented permit the tribunal to understand, with a high degree of probability and plausibility, that the alienation of the vehicles in question to the corresponding dealerships was a reality. With respect to this it is important to note what Jorge Lopes de Sousa writes, in Código de Procedimento e de Processo Tributário, Annotated and Commented, Volume II, 6th Edition, Áreas Editora, SA, Lisbon, 2011, p. 256, in annotations to article 115 of said Code, when citing ALBERTO DOS REIS, refers that sufficient proof leads to a judgment of certainty; not of absolute, material, logical certainty, in most cases, but of certainty sufficient for the practical needs of life, of certainty called historical-empirical. That is to say, what is formed on the basis of sufficient proof is, normally, a judgment of probability, but of probability raised to such a high degree that it is sufficient for the reasonable requirements of social security.
80 - In summary, the proof of the sale of the vehicles in question, from the attachment to the case file of the mentioned documents, appears reasonable and proportionate, above all, taking into account the business purpose of the Claimant, focused on the exclusive right to import, into Portugal, motor vehicles of the B… brand and on the sale of such vehicles, forthwith, to the respective dealerships.
81 - The invoices in question (copies), relating to the sales of the vehicles, insofar as they enjoy the presumption of truthfulness that in article 75, no. 1 of the LGT is conferred upon them, with it being incumbent upon the TA, having regard to the provision of article 75, no. 2 of the LGT, in the framework of the founded and objective reasons that it had, to demonstrate that the information inscribed therein does not correspond to reality, permit the conclusion of the real transfer of ownership of the vehicles, constituting means of proof sufficient to rebut the presumptions in question in the case file, that is, the presumption established in article 7 of the Land Registry Code and the one established in no. 1 of article 3 of the CIUC, which means that, at the date in which the tax became due, the ownership of the vehicles in question had been transferred from the Claimant to third parties, not being the same passive subject of the tax in question.
82 - In these circumstances, the vehicles referenced in the case file as having been alienated, are considered to have been sold, in the terms already referred to, on dates prior to the dates relating to the exigibility of the IUC, and accordingly, it should be considered that the Claimant, with respect to such vehicles, was not, at the date to which the assessments in question relate, a passive subject of the tax in question, and accordingly, it cannot be left unconsidered that the legal presumption established in no. 1 of article 3 of the CIUC was rebutted.
83 - The TA, when it understands that the passive subjects of the IUC are, in definitive, the persons in whose name the motor vehicles are registered, without considering that article 3, no. 1 of the CIUC establishes a presumption, nor taking into account the probative elements that were presented to it, as results, in particular, from the tax administrative proceeding, is proceeding to the illegal assessment of the IUC, with respect to the vehicles aforementioned, founded on the erroneous interpretation and application of the rules of subjective incidence of the Single Circulation Tax, contained in the said article 3 of the CIUC, which configures the commission of tax acts lacking in legality due to error on the factual and legal assumptions, determinative of the annulment of the corresponding tax acts, for violation of law.
M - ON ARTICLES 17 AND 18 OF THE CIUC
84 - Being, as we are, in the domain of the assignment of the first registration, it will be important, first of all, to take into account the legal mechanisms established for this purpose, with respect to the vehicles identified in the proceedings and to the corresponding initial registration of ownership.
85 - In light of the provision of article 117, no. 4 of the Road Code, approved by Decree-Law no. 114/94, of 3 May, whose last amendment was introduced by Law no. 47/2017, of 7 July, the registration of the vehicle "[…] must be requested from the competent authority by the person, singular or collective, that proceeds to its admission, importation or introduction into consumption in national territory". (underlining ours)
86 - Article 24, no. 1 of the Motor Registry Regulation, approved by Decree-Law no. 55/75, of 12 February, with the last amendment introduced by Decree-Law no. 201/2015, of 17 September, provides that "The initial registration of ownership of imported vehicles, admitted, assembled, constructed or reconstructed in Portugal is based on the respective request and proof of compliance with fiscal obligations relating to the vehicle". (underlining ours)
87 - On the other hand, article 118, no. 1 of the said Road Code provides that "For each registered vehicle a document must be issued intended to certify the respective registration, containing the characteristics that permit its identification", with no. 2 of the same article adding that "The holder of the vehicle identification document is the person, singular or collective, in whose name the vehicle is registered and who, in the capacity of proprietor or at another legal title, may dispose of it […]". (underlining ours)
88 - The document intended to certify the respective registration, as follows from what is established in article 4, no. 1 of Decree-Law no. 178-A/2005, of 28 October which approved the Unique Motor Document and created the Registration Certificate, is issued "[…] when the first registration of imported, admitted, assembled, constructed or reconstructed vehicle in Portugal takes place", with no. 2 of said article providing that "The carrying out of any act relating to a vehicle that implies alteration of the elements contained in the registration certificate determines the issuance of a new certificate, with the delivery of the previous one being mandatory". (underlining ours)
89 - Note that the aforementioned first registration must be requested within the period of 60 days, after the assignment of the registration, in light of the provision of nos. 1 and 2 of article 42 of the Motor Registry Regulation, when therein it is established that "1 - The mandatory registration must be requested within the period of 60 days from the date of the fact. 2 - Where it is initial registration of ownership, the period referred to in the preceding number is counted from the date of assignment of the registration". (underlining ours)
90 - The combination of the mentioned rules, points in the direction that the first registration of the vehicle cannot fail to be carried out in the name of the person who proceeds to its admission, importation or introduction into consumption in national territory, in the case, in the name of the Claimant, which must make proof of the compliance of its fiscal obligations, particularly of the ISV.
91 - It is within this framework that the first registration of each of the vehicles in question will be carried out in the name of the Claimant. This is a registration of ownership of the vehicles, absolutely unavoidable and ab initio known, embodied in the person of the importer.
92 - The first registration of each of the vehicles identified in the case file, being unable, to any extent, to be circumvented by the Claimant (a company of importation, commercialization and distribution of motor vehicles), in the measure of its association with the CDV and the payment of the Vehicle Tax (ISV), assumes, for the State, as creditor of the tax, an important function of certainty and fiscal security, in that in the absence of such requested registration, within the legal period, the IUC will be assessed and demanded from the passive subject of the ISV, embodied in the respective importers, given that they and not others are the persons referenced in the CDV, as follows from nos. 1, subparagraph a) of article 18 of the CIUC, which means that only in the case of the property of the vehicles not having been registered within said period of 60 days is the IUC to be demanded from the Claimant.
93 - The registration of initial ownership of the vehicle must, therefore, be carried out within the period of 60 days, counted from the date of assignment of the registration, as results from the provision of nos. 1 and 2 of article 42 of the Motor Registry Regulation, with the tax being assessed by the passive subject within 30 days following the end of the period required for the request for registration, in light of what is established in no. 1 of article 17 of the CIUC.
94 - The aforesaid in the mentioned no. 1 of article 17, whose heading refers to "Deadline for assessment and payment", which, like article 18, embodies a rule specially applicable to the assessment of the tax, when it is a matter of registration or initial registration of vehicles in national territory, provides that in "In the year of registration of the vehicle in national territory, the tax is assessed by the passive subject of the tax within 30 days following the end of the period legally required for its respective registration", the period which, as was already noted above, is 60 days, pursuant to no. 2 of article 42 of the Motor Registry Regulation.
95 - It follows, therefore, from the aforesaid rules, that, in the year of first registration, the determination of the passive subject will only be possible in the circumstances mentioned therein, that is, they are the persons, in whose name the property of the vehicles is registered, in the aforesaid period of 30 days, following the 60 days provided for the request of the respective registration, that embody the passive subjects to whom, legally, the assessment of the IUC and to whom the corresponding payment must be demanded.
It is, moreover, important not to forget that the rules in question, configure, in the economy of the CIUC, special rules, and are therefore specially applicable to situations of registration or initial registration of the vehicle, derogatingly, consequently, the other rules, of a general nature, pertaining to the matter.
96 - In the case of the present proceedings, in light of the presumption established in no. 1 of article 3 of the CIUC, from which it follows that proprietors of the vehicles in whose name the same are registered are presumed to be passive subjects of the tax, and taking into account that, in light of the attachment of the means of proof identified in no. 76, at the moment of exigibility of the IUC, the Claimant had already, with respect to any one of the vehicles identified in the proceedings, proceeded to its sale, the same cannot be considered to be a passive subject of the tax in question.
97 - On the other hand, one cannot fail to consider what is established in article 18 of the CIUC, which has as its heading "Official Assessment", when in its no. 1, subparagraph a) it provides that "In the absence of registration of property of the vehicle carried out within the legal period, the tax due in the year of registration of the vehicle is assessed and demanded: From the passive subject of the vehicle tax on the basis of the customs declaration of the vehicle, or on the basis of the complementary declaration of vehicles on which such tax assessment is based, even though it is not due". (underlining ours)
98 - The provision of the mentioned rules, as was already touched upon above, assumes for the State, as an active subject of the tax, an important function of certainty and fiscal security, in that in the absence of registration of property of the vehicle, within the legal period, which, as was already stated, is 60 days, pursuant to no. 2 of article 42 of the Motor Registry Regulation, the payment of the tax, in the year of registration, is safeguarded.
99 - The IUC will be, thus, in such circumstances, assessed and demanded only from the passive subject of the ISV, embodied in the respective importers, given that they and not others are the persons, as such, referenced in the CDVs, which means that only in the case of the property of the vehicles, in question in the proceedings, not having been registered within said period of 60 days is the IUC to be, legally, demanded from the Claimant.
100 - With respect to the assessment of the tax, it should be underlined, as was already noted above, that assessment, being an act defining the position of the tax administration before the public, makes certain and exigible the tax obligation. Now, on the date on which, in light of the provision of article 17, no. 1 of the CIUC, the tax obligation became certain and exigible, the Claimant was not a passive subject of the tax, having rebutted the presumption established in no. 1 of article 3 of the CIUC.
101 - Note that, moreover, because it is not a matter of minor importance, the understanding of the TA, when it considers the Claimant to be a passive subject of the tax, for having been the person in whose name, first and originally, the vehicle was registered, on the ground that, in light of the provision of no. 3 of article 6 of the CIUC, the same is considered exigible on the first day of the taxation period referred to in no. 2 of article 4, which presents a direct relationship with the issuance of the registration certificate, transports us to the impossibility of total reconciliation with the principle of equivalence.
102 - In fact, if this were so, we would be faced with an interpretation radically restrictive of the rules making up the system of IUC reflected in the respective Code, conducive to the crushing of said principle of equivalence, which, having been established in favor of certain persons in particular and of the community in general, would, thus, by way of such interpretation, have its purposes completely reversed.
103 - Indeed, should the Claimant be the passive subject of the tax, which, as an importer of the vehicles, proceeds to its acquisition without the same having circulated, selling them, consequently, in those very same conditions, that is, with 0 km, we would be faced with a situation embodying an intolerable legal paradox, in that, on one hand, whoever never has circulated or will circulate with the vehicles, in the measure that proceeded to its sale with 0 km, would support a tax which, precisely, falls on its circulation, unburdening itself, on the other hand, of said tax, whoever, in the end, is its "economic-owner-user", who, really and actually, will circulate with said vehicles.
104 - The principle of equivalence, being structuring of the IUC system and its Code, would be directly and absolutely disregarded. The said principle would, if this were so, be completely emptied in its reach and most innovative and relevant sense, which, as is known, points, fundamentally, to the fact that taxpayers be burdened, in the measure of the costs that they cause, in particular, to the environment and to the road network, which would correspond, also, to an interpretation revealing total lack of propriety, which, as is taken from the provision of no. 3 of article 9 of the Civil Code, is not imagined to have been wished by the legislator.
105 - On the other hand, the understanding followed by the TA, inscribed, in particular, in the PA, when, in the framework of the rejection of the request for official review of the assessments, it considers that the applicable rules, in the case of the present proceedings, are the ones contained in nos. 1 and 3 of article 6 of the CIUC, specifying that "In the case of vehicles first registered in Portugal, the taxable event of the tax is constituted by the ownership of the vehicles as evidenced by the registration or registration in national territory (article 6, no. 1 of the CIUC), and the moment of exigibility is the first day of each taxation period in accordance with no. 3 of the same rule. Thus, (…) in the case of terrestrial vehicles first registered in Portugal, (the IUC) is due on the date of registration", will not lead to a different result from what was referred to above, that is, that the Claimant is not a passive subject of the tax with respect to the assessments in question in the case file. In fact,
106 - Having regard to the said understanding, that is, that "in the case of terrestrial vehicles first registered in Portugal, (the IUC) is due on the date of registration", and being certain, as was already referred to above, that the sale of the vehicles occurred on dates prior to those of the assignment of the registrations of the vehicles identified in the proceedings, rebutting the presumption established in no. 1 of article 3 of the CIUC, there is no doubt that, on the dates of exigibility of the tax, the Claimant was not the passive subject of the IUC.
CONCLUSION
107 - Within the circumstantial framework that has been referred to, the TA, when it committed the assessment acts in question in the present proceedings, founded on the idea that it is not possible to set aside the subjective incidence of the tax provided for in article 3, no. 1 of the CIUC and that the tax legislator did not stipulate that importers may be excluded from subjective incidence in the context of the IUC, should they proceed to the sale of vehicles prior to the assignment of the registration certificate, makes an erroneous interpretation and application of the law, committing an error on the legal assumptions, which constitutes violation of law.
108 - On the other hand, because the TA, on the date on which the IUC, in light of the provision of no. 1 of article 17 of the CIUC was to be assessed, considered the Claimant proprietor of the vehicles referenced in the present proceedings, considering it, as such, a passive subject of the tax, when such property was no longer inscribed in its legal sphere, founding itself, thus, on factual matter divergent from the actual reality, commits an error on the factual assumptions, and, therefore, of violation of law.
III - DECISION
109 - Therefore, having regard to all the foregoing, this Arbitral Tribunal decides:
- To rule that the claim for annulment of the assessment acts of IUC and compensatory interest, to which the Claimant's claim refers, has merit, founded on a defect of violation of law;
- To annul, both the assessment acts of IUC, relating to the years 2011 to 2014, identified in the notifications attached to the case file, and the assessment acts of compensatory interest that are associated with them;
- To annul the order of 13-12-2016 of the chief of the Division of the Large Contributors Unit of the TA, which rejected the request for official review of said assessments, identified in the case file under no. …;
- To condemn the TA to payment of compensatory interest at the legal rate, counted from the date of payment of the amount to be reimbursed, until its full reimbursement;
- To condemn the TA to pay the costs of the present proceedings.
VALUE OF THE PROCEEDING
In conformity with the provisions of articles 306, no. 2 of the CPC (formerly 315, no. 2) and 97-A, no. 1 of the CPPT and in article 3, no. 2 of the Regulation of Costs in Proceedings of Tax Arbitration, the value of the proceeding is established at €6,000.32.
COSTS
In accordance with no. 4 of article 22 of the RJAT, the amount of the costs is established at €612.00, at the charge of the Tax Authority and Customs Authority, pursuant to article 4 of the Regulation of Costs in Proceedings of Tax Arbitration and to the Table I, which is attached thereto.
Notify.
Lisbon, 15 September 2017
The Arbitrator
António Correia Valente
(The text of the present decision was prepared by computer, pursuant to article 131, no. 5 of the Code of Civil Procedure (formerly 138, no. 5), applicable by reference of article 29, no. 1, subparagraph e) of Decree-Law no. 10/2011, of 20 January (RJAT), with its redaction being governed by the orthography prior to the Orthographic Agreement of 1990.)
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