Summary
Full Decision
Case No. 174/2015-T
Claimants: A… and the Undivided Estate of B…, represented by C…
Defendant: Tax and Customs Authority
I. REPORT
A…, Tax ID Number…, resident at Avenue …, …, Block …, …, in …, and the Undivided Estate of B…, Tax ID Number…, herein represented by the head of household C…, resident at Avenue …, … – …, in …, (hereinafter referred to only as Claimants), filed on 13-03-2015 a request for constitution of a single arbitral tribunal, pursuant to articles 2 and 10 of Decree-Law No. 10/2011, of 20 January (Legal Regime of Arbitration in Tax Matters, hereinafter referred to only as LRAT), in conjunction with article 99(a) of the Tax Procedure Code, whereby the Tax and Customs Authority is the Defendant (hereinafter referred to only as Defendant).
The Claimants request the declaration of illegality and unconstitutionality of the acts of assessment of Stamp Duty, with reference to item 28.1 of the General Table of Stamp Duty (hereinafter, GTSD), in the total amount of €15,468.92, made in 2012 and 2013, relating to the urban property registered under article … in the urban property register of the parish of …, municipality of Lisbon, and which gave rise to the following collection documents:
a) Documents nos. 2012 …, 2012 …, 2012 …, 2012 …, 2012 .., 2012 …, 2012 …, 2012 …, 2012 .., 2012 …, 2012 …, 2012 .., 2012 .., 2012 … and 2012 .., in the name of the second of the Claimants;
b) Documents nos. 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 …, 2012 … and 2012 ..., in the name of the first of the Claimants;
c) Documents nos. 2013 …, 2013 .., 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …., 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, and 2013 …, in the name of the second of the Claimants; and
d) Documents nos. 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 .., 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …., 2013 …, 2013 …, 2013 …, 2013 .., 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …, 2013 …., 2013 …, 2013 .., 2013 …, 2013 …, 2013 …, in the name of the first of the Claimants.
The Claimants further request the condemnation of the Defendant to reimburse the tax paid, plus compensatory interest.
The request for constitution of the arbitral tribunal was accepted by the Honourable President of CAAD on 16-03-2015 and notified to the Tax and Customs Authority on that same date.
Pursuant to article 6(2)(a) and article 11(1)(b) of the LRAT, the Deontological Council appointed as arbitrator of the single arbitral tribunal the undersigned, who communicated acceptance of the assignment within the applicable deadline.
On 06-05-2015 the parties were duly notified of this appointment, and they did not manifest any will to refuse the appointment of the arbitrator, in accordance with articles 11(1)(a) and (b) of the LRAT and articles 6 and 7 of the Code of Ethics.
In accordance with article 11(1)(c) of the LRAT, the single arbitral tribunal was constituted on 21-05-2015.
By order of 28-06-2015, the meeting provided for in article 18 of the LRAT was dispensed with, as well as the presentation of arguments, oral or written, with both parties having previously agreed.
The Claimants allege, briefly, the illegality of the tax assessments in question in that they took as the basis of incidence the total patrimonial value of the property and not the individual values of each of the independent parts that compose it. By express reference of the law, the basis of incidence of Stamp Duty of item 28.1 of the GTSD should be the same as that of the Municipal Property Tax (IMI). In that regard, where there is at issue a property in full ownership composed of units capable of independent use, some of which are intended for residential use, the patrimonial value relevant for purposes of assessment of the said tax will be that of each of them individually considered and not their sum. This very fact results from the circumstance that in the context of IMI there is no distinction between properties in horizontal ownership and in full ownership, with all being subject to the same rules of registration in the property register, of appraisal and of assessment.
Subsidiarily, the Claimants understand that the norms underlying the assessment of the tax now contested, in the interpretation given by the Defendant, would be unconstitutional by violation of the principle of equality, in its aspect of tax equality – contributive capacity, pursuant to articles 13 and 104(3) of the Constitution.
Finally, as regards specifically the tax assessments made in 2013, the Claimants consider that they are illegal due to duplication of collection, in that they refer to the tax due for the taxable event that occurred in 2012, and that, under the transitional regime of Law No. 55-A/2012, of 29 October, such tax had been assessed and paid in 2012.
In response, the Defendant argues, briefly, that in properties not subject to horizontal ownership, units capable of independent use do not have any autonomy; the autonomization for purposes of property registration and appraisal does not affect their tax-legal nature, with the law determining that the value of the property will necessarily correspond to the sum of the value of the various independent units. Units of independent use cannot be considered as "properties" in accordance with the legal definition and therefore cannot be relevant for purposes of the incidence of item 28.1 of the GTSD. For purposes of this norm, account must therefore be taken of the patrimonial value of the property in full ownership, which will correspond, pursuant to the law, to the sum of the values of each unit capable of independent use. The Defendant further concludes that the interpretation defended by the Claimants with reference to the said item 28.1 of the GTSD would imply its unconstitutionality by violation of the principles of legality and tax equality.
III. PRELIMINARY EXAMINATION
The Arbitral Tribunal was regularly constituted and is competent.
The parties enjoy tax and judicial capacity and are legitimate (articles 4 and 10(2) of the same statute and article 1 of Order No. 112-A/2011, of 22 March).
The proceedings are not subject to any nullities and there is no obstacle to the examination of the merits of the case.
IV. FINDINGS OF FACT
A. Established Facts
The following facts are considered established:
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The Claimants are co-owners, in the proportion of one half each, of the urban property in full ownership registered in the property register under article … of the parish of …, in the municipality of …, with a tax patrimonial value of €1,172,458.83;
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The aforementioned property has 30 units capable of independent use, 15 of which are intended for residential use;
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On 31 October 2012, none of the units capable of independent use has a tax patrimonial value exceeding €1,000,000.00;
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On 31 December 2013, none of the units capable of independent use has a tax patrimonial value exceeding €1,000,000.00;
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In November 2012, the Claimants were notified of the assessments of Stamp Duty, item 28.1 of the GTSD, for the year 2012, relating to each of the divisions capable of independent use intended for residential use of the identified property, in the total amount of €5,156.32;
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In March 2013, the Claimants were notified of the assessments of Stamp Duty, item 28.1 of the GTSD, for the year 2012, relating to each of the divisions capable of independent use intended for residential use of the identified property, in the total amount of €10,312.64;
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The collection documents issued in the name of the Claimants were paid within their respective legal deadlines;
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The first of the Claimants paid a total of €7,734.48 as Stamp Duty of item 28.1 with reference to the identified property;
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The second of the Claimants paid a total of €7,734.48 as Stamp Duty of item 28.1 with reference to the identified property;
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The request for ex officio review of the assessment acts was rejected by order dated 15/01/2015, rendered by the Chief Finance Officer of Lisbon 7, exercising delegated powers.
B. Unestablished Facts
No other facts with relevance to the arbitral award were established.
C. Reasoning for the Findings of Fact
The findings of fact given as established are based on documentary evidence presented and not contested.
V. LEGAL ISSUES
A. Regarding the Tax Assessed
The essential question to be decided concerns the determination of the basis of incidence of Stamp Duty, item 28.1 of the GTSD, when there is at issue a property not constituted in horizontal ownership and whose units capable of independent use are intended for residential use.
In concrete terms, it is necessary to decide whether the patrimonial value relevant as a criterion of tax incidence corresponds to (i) the sum of the value of each of those units capable of independent use, as the Defendant contends, or (ii) the individual patrimonial value of each of those units capable of independent use, considered autonomously and in themselves, as the Claimants contend.
The doubt results from the interpretation of items 28 and 28.1 of the GTSD, whose wording in force on 31 December 2013 was as follows:
"28. Ownership, usufruct or right of surface of urban properties whose tax patrimonial value recorded in the property register, in accordance with the Municipal Property Tax Code (MPTC), is equal to or greater than €1,000,000 - on the tax patrimonial value used for purposes of IMI:
28.1 Per property with residential use – 1%"
The legislator did not take care to establish a legal concept of "property with residential use," having expressly provided that all matters not regulated in the Stamp Duty Code with reference to the said item 28 of the GTSD would be subject, subsidiarily, to the provisions of the MPTC. It is therefore necessary to seek in the MPTC such concept, in order to be able to conclude regarding the basis of incidence of item 28.1 of the GTSD.
The legal definition of "property" is contained in article 2 of the MPTC, with article 2(4) clarifying that "For purposes of this tax, each autonomous fraction, under the horizontal ownership regime, is deemed to constitute a property."
From a reading of this article, and in particular the mentioned article 2(4), we would be led to conclude that for purposes of IMI, an autonomous fraction of a property in horizontal ownership assumes the nature of a "property," whereas a unit capable of independent use of a property in full ownership does not assume such nature, not having tax-legal autonomy.
As a result of this difference in treatment, it would be defensible that for purposes of item 28.1 of the GTSD, each autonomous fraction should be considered as a "property," so that there would only be place for payment of such tax if, being intended for residential use, it had a tax patrimonial value exceeding the indicated amount. In the case of a property in full ownership, the patrimonial value to be considered for purposes of determining incidence would result from the sum of the patrimonial values of each independent unit intended for residential use – see article 7(2)(b) of the MPTC. This is the position of the Defendant.
It happens, however, that in a comparative analysis of the IMI regime applicable to autonomous fractions of properties in horizontal ownership and to units capable of independent use of properties in full ownership, it is concluded that there is no difference. Indeed, notwithstanding the formal legal nature being distinct, the tax regime of these figures is exactly the same. Materially, the law establishes no difference whatsoever:
(i) Properties in horizontal ownership and in full ownership are subject to the same rules of registration in the property register, with article 12(3) of the MPTC expressly providing that parts capable of independent use are considered separately in the property registration which will also discriminate their respective tax patrimonial value;
(ii) Properties in horizontal ownership and in full ownership are subject to the same rules and procedures of appraisal, with article 7(2)(b) of the MPTC expressly determining that if the parts that compose the property in full ownership are economically independent, each part is appraised by application of the corresponding rules.
This identity of regime goes even further, having relevant consequences at the level of the tax assessment itself, in that the legislator determined that the assessment of IMI should be made with discrimination of the properties, their parts capable of independent use and their respective tax patrimonial value – see article 119(1) of the MPTC. It is thus the legislator who determines that the tax assessment should be made on an individual basis, considering each economic reality and not each merely legal reality.
From this it is concluded that for purposes of IMI, autonomous fractions of properties in horizontal ownership and parts capable of independent use that compose a property in full ownership have exactly the same tax treatment. But more relevant than that: for purposes of IMI, the basis of incidence of the tax is determined in exactly the same manner, corresponding to the proper and individual value of each autonomous fraction or independent part, fixed in the appraisal and recorded in the property register; the assessment is made in an individualized and autonomous manner based on each of the independent parts of the property, whether or not they are autonomous fractions.
In the case of properties in full ownership, IMI is not assessed on the basis of the total tax patrimonial value of the property, but on the basis of the individual tax patrimonial value of each autonomous unit that composes it; the total tax due corresponds to the sum of the individual taxes for each autonomous unit, determined based on their respective individual tax patrimonial values. Everything proceeds in exactly the same manner as that applied for autonomous fractions of properties in horizontal ownership.
Furthermore, pursuant to item 28.1 of the GTSD, only "properties with residential use" are subject to taxation. Now, in properties composed of independent units with different destinations and uses – as is the case in the present proceedings – the determination of the use designation can only be made based on each of these units and not based on the property as a whole. This very fact results from article 7(2)(b) of the MPTC. On this matter, it is appropriate to refer to J. Silvério Mateus and L. Corvelo de Freitas, Real Estate Property Taxes – Stamp Duty, Annotated and Commented, Engifisco, 1st Edition, 2005, p. 121, note 5, who understand that "The rules provided in this paragraph 2, relating to the determination of the tax patrimonial value of urban properties with more than one use designation, have to do with the diversity of some of the appraisal elements provided for in articles 38 et seq. of the MPTC, namely (….). On the other hand, this provision is in consonance with the principle of autonomization of independent parts of an urban property, even if not constituted in horizontal ownership, provided for in article 12(3)." (emphasis in original)
In a situation such as the present, how could it be concluded that the property would have a residential use designation, if there are parts of the same intended for other purposes?
In truth, in accordance with the appraisal rules provided for in the MPTC, what has a use designation is not the property as a building in its entirety but the autonomous units that compose it, whether they are autonomous fractions or not. It is based on the actual and material use that the use designation of each independent unit or autonomous fraction is determined, with the law not providing a specific designation for the property as a building. Each independent unit – whether or not an autonomous fraction – has, therefore, its own use designation that does not "contaminate" the use designation of the property as a whole.
Therefore, one cannot argue that "property with residential use" corresponds to the strict and proper concept of article 2 of the MPTC (encompassing only, for the purpose we seek, buildings and autonomous fractions of properties in horizontal ownership), in that, as demonstrated, it would not have practical applicability (as mentioned, a property in full ownership may have more than one use designation or destination); in using this expression the legislator meant to refer to the property as a reality capable of use designation, hence to the independent parts that compose each property, whether or not they have the legal nature of autonomous fractions.
It is therefore concluded that for purposes of application of item 28.1 of the GTSD, the units capable of independent use that form part of a property in full ownership and autonomous fractions are, in substance, identical realities and that, accordingly, are subject to the same regime of incidence.
In that regard, the final part of item 28 of the GTSD, by determining that the tax will incur "(…) on the tax patrimonial value used for purposes of IMI:" expressly refers to the individual value of each independent part that composes the property in full ownership and not to the total value of the property (corresponding to the sum of the individual tax patrimonial values), in that it is this individual value that is considered in IMI, for all purposes.
Furthermore, pursuant to article 23(7) of the Stamp Duty Code, the tax due under item 28 of the GTSD is assessed annually in accordance with the rules provided for in the MPTC. And it was precisely these rules that led the Defendant to assess the tax individually for each autonomous unit and considering its respective individual tax patrimonial value. Hence there were issued as many documents as there were units of independent use.
If the Defendant's interpretation were to apply here, there would be only one Stamp Duty assessment per property and not as many assessments as there are units capable of independent use.
Finally, it is appropriate to note that this matter has been the subject of various CAAD decisions, as the Claimants properly point out, all in this same sense, transcribing here, by way of example, the arbitral decision rendered in case 50/2013-T, in the part with which we agree:
"Thus, being so, considering that the registration in the property register of real property in full ownership, constituted by different parts, floors or divisions with independent use, in accordance with the MPTC, obeys the same rules of registration of real property constituted in horizontal ownership, with the respective IMI, as well as the new Stamp Duty, assessed individually in relation to each of the parts, it offers no doubt whatsoever that the legal criterion for defining the incidence of the new tax must be the same.
Moreover, the Tax Authority admits that this is the criterion, which is why the assessment issued itself is very clear in its essential elements, from which it results that the value of incidence corresponds to the tax patrimonial value of the 2nd floor and the individualized assessment on the part of the property corresponding to that same floor.
Therefore, if the legal criterion imposes the issuance of individualized assessments for the autonomous parts of properties in full ownership, in the same manner as it establishes for properties in horizontal ownership, it has clearly established the criterion, which must be unique and unambiguous, for the definition of the rule of incidence of the new tax.
Thus, there would only be place for incidence of the new stamp duty if any of the parts, floors or divisions with independent use presented a tax patrimonial value exceeding €1,000,000.00.
The Tax Authority cannot, therefore, consider as the value of reference for the incidence of the new tax the total value of the property, when the legislator itself established a different rule in the context of the MPTC, and this is the code applicable to matters not regulated as regards item 28 of the GTSD.
The criterion sought by the Tax Authority, of considering the value of the sum of the tax patrimonial values assigned to the parts, floors or divisions with independent use, with the argument that the property is not constituted in the horizontal ownership regime, finds no legal support and is contrary to the criterion that results as applicable in the context of the MPTC and, by referral, in the context of Stamp Duty.
Furthermore, the law itself expressly establishes, in the final part of item 28 of the GTSD, that the Stamp Duty to incur on urban properties with value equal to or exceeding €1,000,000.00 – "on the tax patrimonial value used for purposes of IMI."
Thus, the adoption of the criterion defended by the Tax Authority violates the principles of legality and tax equality, as well as the prevalence of material truth over formal legal reality."
In the same sense, reference should be made to the decision rendered in case 132/2013-T, from which we transcribe the part with which we entirely agree:
"Indeed, it makes no sense to distinguish in the law what the law itself does not distinguish (ubi lex non distinguit nec nos distinguere debemus). Furthermore, distinguishing, in this context, between properties constituted in horizontal ownership and in full ownership would be an "innovation" without associated legal support, especially because, as has been stated here, nothing indicates, neither in item 28 nor in the MPTC provisions, a justification for that particular differentiation. Note, by way of example, what article 12(3) of the MPTC states: "each floor or part of a property capable of independent use is considered separately in the property registration, which also discriminates its respective tax patrimonial value."
The uniform criterion that is required is thus the one that determines that the incidence of the norm in question only takes place when any of the parts, floors or divisions with independent use of a property in horizontal or full ownership with residential use designation has a tax patrimonial value exceeding €1,000,000.00. Fixing as the value of reference for the incidence of the new tax the global tax patrimonial value of the property in question, as the now defendant sought, finds no basis in the applicable legislation, which is the MPTC, given the referral made by the cited article 67(2) of the Stamp Duty Code.
Finally, as has been recalled in various Arbitral Decisions (see AD No. 48/2013-T and AD No. 50/2013-T), there is not discernible, in the documents relating to the discussion of bill no. 96/XII in the National Assembly, the invocation of an interpretative rationale distinct from the one presented here. Indeed, this measure was justified, termed a "special tax on urban residential properties of higher value," with the need to comply with the principles of social equity and tax justice, burdening more significantly the holders of high-value properties intended for residential use, and, in that regard, making the new "special tax" incur on "homes valued at equal to or exceeding 1 million euros."
Now, if such logic seems to make sense when applied to «residential use» - whether it be «home», «autonomous fraction» or «part of property with independent use» / «autonomous unit» -, because it is assumed a contributive capacity above the average and, in that regard, justifies the need for realization of additional contributive effort, it would make little sense to cease to consider the calculations "unit by unit" when only through the sum of the tax patrimonial values of the same (because held by the same individual) would the million euros threshold be exceeded.
Furthermore, admitting the differentiation of treatment could produce results incomprehensible from a legal perspective and contrary to the objectives that the legislator said it had for adding item 28. By way of illustrative example, suppose the following hypothesis, which seems plausible in light of the interpretation made by the now defendant: a citizen who is the owner of a property constituted in full ownership intended for residential use, with the global value of the autonomous units equal to or exceeding €1,000,000.00 and the tax patrimonial value of each one below €1,000,000.00, is subject to an annual taxation of 1% of that value (as happened in the situation under analysis); whereas another citizen who holds a property with the exact same characteristics as the previous one but which has been constituted in horizontal ownership, with the global value of the autonomous fractions also equal to or exceeding €1,000,000.00 and the tax patrimonial value of each one below €1,000,000.00, will not be subject to taxation under the aforementioned item 28.
On the other hand, one could ask: if such fractions have the same owner, why does it not make sense to aggregate, for purposes of taxation, their respective tax patrimonial values? The answer can be illustrated through another hypothesis: a citizen who is the owner of a property in horizontal ownership, in which each of its 20 fractions has a tax patrimonial value below €1,000,000.00, would be subject to taxation if – if such aggregation were allowed – the global tax patrimonial value exceeded that amount; whereas another citizen with identical 20 fractions distributed across 5, 10 or 20 properties would not be subject to any taxation under the aforementioned item 28.
If this line of reasoning makes sense – justifying, therefore, the non-aggregation of the tax patrimonial values of fractions of properties in horizontal ownership –, there is no plausible reason why the same should not be applied to the autonomous units of properties in full ownership.
Observing now the case under analysis, it is found that the tax patrimonial values of the floors (autonomous units) of the property with residential use designation vary between €104,140.00 and €113,780.00, so that any one of them is below €1,000,000.00. From this it is concluded, as a result of what has been stated, that on the same cannot incur the stamp duty referred to in item 28 of the GTSD, being therefore illegal the assessment acts challenged by the claimant."
Given everything set forth above, this tribunal concludes that this is the interpretation of the law in accordance with the Constitution in that it ensures equal tax treatment of identical realities, giving prevalence to substance over form – an interpretative imperative imposed by article 11(3) of the General Tax Law.
In truth, where it is a matter of a tax on real property, the contributive capacity of each taxpayer should be assessed based on the value of their respective real property intended for residential use, irrespective of its legal regime. To admit as valid the interpretation of the Defendant would lead to situations in which for the same total value of real property, for example €1,200,000.00 composed of 6 apartments of €200,000.00 each, the incidence of tax would be dependent only on a purely formal criterion: existence or not of horizontal ownership. In this hypothesis, how could it be said that the contributive capacity differs between a taxpayer who has 6 apartments of €200,000.00 each in a property not subject to horizontal ownership and one who has 6 apartments of €200,000.00 each in a property in horizontal ownership? Globally, is the real property not worth exactly the same?
As José Casalta Nabais states, The Fundamental Duty to Pay Taxes, 2004, Almedina, p. 436, the constitutional principle of equality obliges the legislator to "(…) not make discriminations or equalizations that are arbitrary or lacking in justification or material or rational foundation, not to make discriminations based on subjective criteria or on objective criteria, but applied in subjective terms and to respect the subjective rights of equality (that is, to treat equally what is constitutionally equal and unequally what is constitutionally unequal)". This author further states (see p. 442) that "(…) we can say that the principle of tax equality requires that what is (essentially) equal be taxed equally, and what is (essentially) unequal be taxed unequally to the extent of that inequality. But the comparison of what is equal or unequal implies a criterion or a term of comparison (tertium comparationis). And this is identified with the idea of contributive capacity."
Thus, it is not accepted that the mere legal-formal organization of real property – constituted or not in horizontal ownership – could be constitutionally valid justification for differentiated treatment of taxpayers.
Given the foregoing, there is no doubt that the interpretation defended by the Claimants and here accepted by this tribunal is the one that ensures the constitutional conformity of items 28 and 28.1 of the GTSD, in light of articles 13 and 104(3) of the Constitution, in that it allows "treating equally what is constitutionally equal and unequally what is constitutionally unequal," as stated by the author previously identified.
Therefore, the Defendant's request for a ruling of unconstitutionality of the aforementioned legal norms, for violation of the principle of legality, fails.
Given everything set forth above, the tribunal concludes that for purposes of application of items 28 and 28.1 of the GTSD to properties in full ownership, the same rules of the MPTC that apply to properties in horizontal ownership apply, so that the tax patrimonial value to be considered for purposes of incidence will be the individual proper value of each unit capable of independent use.
The material substance is what imposes itself as the determining criterion of contributive capacity and not the mere legal-formal reality of the property, so that, materially, the tax regime applicable to properties in full ownership is exactly the same as that applied to properties in horizontal ownership.
None of the independent units intended for residential use that compose the identified property and owned by the Claimants presents a value exceeding €1,000,000.00, so the minimum quantitative prerequisite for purposes of incidence of item 28.1 of the GTSD is not met.
For all these reasons, this tribunal considers the position of the Claimants well-founded, concluding that the identified assessment acts - Stamp Duty due under item 28.1 of the GTSD, made in 2012 and 2013 - are affected by the vice of violation of law, due to error in the factual and legal premises, which justifies their annulment [article 135 of the Administrative Procedure Code, applicable by force of the provision in article 2(c) of the General Tax Law].
Moreover, it considers unfounded the allegation of unconstitutionality of item 28.1 of the GTSD, for violation of the principle of legality provided for in article 103(3) of the Constitution, made by the Defendant.
Concluding that the annulment of the Stamp Duty assessments contested by the Claimants with these grounds prejudices, as being pointless, the examination of the vice of duplication of collection invoked by the Claimants with reference to the assessments made in 2013.
B. Regarding Compensatory Interest
It results from the established facts that the Stamp Duty assessed, in the total amount of €15,468.92, was paid by the Claimants within the legally stipulated deadlines.
Pursuant to article 43(1) of the General Tax Law, "Compensatory interest is due when it is determined, in a gracious reclamation or judicial contestation, that there was error attributable to the services from which resulted payment of the tax debt in an amount higher than legally due."
As Diogo Leite de Campos, Benjamim Silva Rodrigues and Jorge Lopes de Sousa state, General Tax Law - Annotated and Commented, Editor Encontro da Escrita, 4th Edition, 2012, p. 342, note 2 "The error attributable to the services that carried out the assessment is demonstrated when they proceed to gracious reclamation or contestation of that same assessment and the error is not attributable to the taxpayer (for example, there will be annulment due to error attributable to the taxpayer when the assessment is based on incorrect factual premises, but the error is based on incorrect information in the statement that the taxpayer presented)."
Now, in the concrete case, it is unequivocally justified the request for payment of compensatory interest on the part of the Claimants in that the tax assessments contested are shown to be affected by illegality and therefore should be annulled. Beyond the reimbursement, the Claimants also have the right to payment of compensatory interest, at the legal rate in force, on the amount of €15,468.92, counted from the date of payment until the date of processing of the respective credit note, in which are included – see article 43 of the General Tax Law and article 61(4) of the Tax Procedure Code.
VI. DECISION
In accordance with the foregoing, the members of this Arbitral Tribunal agree to:
A) Find the request for arbitral pronouncement well-founded as to the request for annulment of the Stamp Duty assessments made in 2012 and 2013 identified and contested by the Claimants, annulling them, and condemning the Defendant to reimburse the amounts paid by the Claimants;
B) Condemn the Defendant to the payment of compensatory interest, on the amount of €15,468.92, at the legal rate in force, counted from the date of payment of each one of the identified collection documents, until the date of processing of the respective credit note, in which will be included, in accordance with articles 43 of the General Tax Law and 61 of the Tax Procedure Code.
Value of the Case: In accordance with article 306(2) of the Code of Civil Procedure and 97-A(1)(a) of the Tax Procedure Code and article 3(2) of the Regulation of Costs in Arbitration Proceedings in Tax Matters, the case is valued at €15,468.92.
Costs: Pursuant to article 22(4) of the LRAT, the amount of costs is fixed at €918.00, in accordance with Table I attached to the Regulation of Costs in Arbitration Proceedings in Tax Matters, to be borne by the Tax and Customs Authority.
Let this arbitral award be registered and notified to the parties.
Lisbon, 27-07-2015
The Single Arbitrator
(Maria Forte Vaz)
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