Summary
Full Decision
ARBITRAL DECISION
I – REPORT
A..., SA, taxpayer no...., with head office at..., Building..., ..., ...-... SINTRA, hereinafter referred to as the Claimant, filed a request for the constitution of an arbitral tribunal in tax matters and a request for arbitral pronouncement, pursuant to the provisions of articles 2.º no. 1 a) and 10.º no. 1 a), both of Decree-Law no. 10/2011, of 20 January (Legal Regime for Arbitration in Tax Matters, abbreviated as RJAT), petitioning for the declaration of illegality of the acts of assessment of the Single Circulation Tax (IUC), identified as Documents nos. 1 to 14 of the administrative complaint that forms part of the administrative proceedings, which are hereby fully reproduced, effected by the Tax and Customs Authority, relating to the years 2013 and 2014, in the total amount of € 1,497.88, as well as the payment of default interest on the amounts paid.
The request for constitution of the arbitral tribunal was accepted by the President of CAAD and automatically notified to the Tax and Customs Authority on 23-03-2015.
Pursuant to the provisions of articles 5.º, no. 2, al. a), 6.º, no. 1 and 11.º, no. 1, al. a) of the RJAT, the Deontological Council appointed the signatory as arbitrator of the single arbitral tribunal, who communicated acceptance of the mandate within the applicable period.
On 15-05-2015 the parties were duly notified of this appointment and did not manifest the intention to challenge the appointment of the arbitrator, in accordance with the combined provisions of article 11.º no. 1 clauses a) and b) of the RJAT and articles 6.° and 7.º of the Deontological Code.
Thus, in conformity with the provision in clause c) of no. 1 of article 11.º of the RJAT, the single arbitral tribunal was constituted on 31-07-2014.
On 29-10-2015, the tribunal held the meeting provided for in article 18.º of the RJAT and examination of the witness cited by the Claimant.
The arbitral tribunal was regularly constituted and is materially competent, in light of the provisions of articles 2.º, no. 1, clause a), and 30.º, no. 1, of DL no. 10/2011, of 20 January.
The parties possess legal personality and capacity, are legitimate and are represented (arts. 4.º and 10.º, no. 2, of the same decree and art. 1.º of Order no. 112-A/2011, of 22 March).
The proceedings are not affected by any defects and no exceptions were raised.
The allegations supporting the Claimant's request for arbitral pronouncement are, in summary, as follows:
Claimant's Allegations
10.1 The present request is filed following the rejection decision of the administrative complaint relating to the acts of self-assessment of IUC for the years 2013 and 2014, and the present tribunal has competence to declare the illegality of the acts of self-assessment and the rejection decision of the administrative complaint itself, pursuant to clause a) of no. 1 of article 2.º of the RJAT.
10.2 Given that the Claimant was notified of the administrative complaint decision on 22-12-2014, the period of 90 days for filing the request for constitution of the arbitral tribunal expired on 23-03-2015, for which reason the request is timely.
10.3 As regards the joinder of claims, the provision of no. 1 of article 13.º of the RJAT is complied with in that the same factual and legal circumstances essentially relate to the assessment of IUC for the years 2013 and 2014.
10.4 Furthermore, as a preliminary matter, the administrative complaint was also filed timely, as the period provided for in article 131.º of the CPPT applies, as we are dealing with a self-assessed tax.
10.5 The Claimant is a commercial company dedicated to the purchase, sale and leasing of goods, equipment and motor vehicles with or without driver.
10.6 In the exercise of its activity, the Claimant concludes contracts for operational leasing of motor vehicles with an average duration of 42 months, proceeding, once the contract ends, to its sale, in accordance with general contractual clauses common to all such contracts.
10.7 These contracts do not provide for the possibility of the lessee acquiring the vehicle at the end of the contract.
10.8 In addition to sales, total losses also occur, resulting from theft or accident, for which the Claimant is indemnified by the insurer, waiving the right to the vehicle in case of theft or, in case of accident, proceeding to the sale of salvage, through the insurer itself.
10.9 When resorting to sales channels (auctioneers or sales outlets), in most cases the buyers did not register the transfer of ownership, despite efforts made by the Claimant.
10.10 In all such situations, including those of theft and accident, the Claimant sends, together with the invoice, the registration request signed by its legal representatives, so that the entities involved may proceed to register the vehicle in the name of the new owner or cancel the registration in case of theft or scrapping.
10.11 The Claimant alienated the motor vehicles on dates prior to the payment deadlines for IUC of the years 2013 and 2014.
10.12 The respective buyers failed to register their ownership.
10.13 Despite no longer being the owner of the vehicles, not having them in its possession, not knowing their whereabouts and, furthermore, considering that the tax is not due, the Claimant proceeded to its assessment.
10.14 Simultaneously, the Claimant filed an administrative complaint against the respective acts of self-assessment.
10.15 The Claimant demonstrated, rebutting the presumption contained in article 3.º of the IUC Code, that it was no longer the owner of the motor vehicles in question on the date on which the respective tax became due.
10.16 The Claimant also alleges in its defense, a uniform understanding in various arbitral decisions, namely in Cases nos. 170/2013-T and 265/2013-T.
10.17 It concludes by requesting the annulment of the IUC assessments subject to these proceedings and the consequent reimbursement of the amounts paid as tax and compensatory interest, as well as the condemnation of the Tax Authority to pay the respective default interest.
Response of the Respondent
11.1 In its Response, the Respondent defends itself by exception, invoking the lapse of the right of action, as the administrative complaint was rejected for being untimely.
11.2 In this circumstance, the Claimant could not pursue these proceedings, as the challengers cannot use the notification of that decision for the purpose of counting the period to challenge.
11.3 In substantive terms, the Tax Authority understands that the allegations of the Claimant: a) constitute a skewed reading of the letter of the law; b) do not observe the systematic element, violating the unity of the regime enshrined in the entire IUC and, more broadly in the entire tax-legal system; and, finally, c) result from an interpretation that ignores the ratio of the regime established in no. 1 of article 3.º of the IUC Code.
11.2 The tax legislator, in establishing in article 3.º, no. 1 who are the passive subjects of the IUC, expressly and intentionally established that these are the owners (or in the situations provided for in no. 2 the persons mentioned therein), considered as such the persons in whose names the same are registered.
11.3 The legislator did not use the expression "is presumed" as it could have done, for example, in the following terms: "the passive subjects of the tax are the owners of the vehicles, being presumed as such the natural or legal persons, of public or private law, in whose names the same are registered".
11.4 Thus, the wording of article 3.º of the IUC Code corresponds to a clear legislative policy option adopted by the legislator, so that understanding that a presumption is enshrined therein would unequivocally be an interpretation contra legem.
11.5 In accordance, this understanding has already been adopted by the case law of our courts, transcribing for this purpose part of the sentence of the Administrative and Tax Court of Penafiel, handed down in Case no. 210/13.0BEPNF. (See article 34.º of the Response)
11.6 On the systematic element of interpretation, the Claimant alleges that the solution advocated by the Claimant is intolerable, finding the understanding supported by the latter no legal support. (Article 36.º of the Response)
11.7 Finally, having regard to the "ratio", of parliamentary debates surrounding the approval of the present regime, it clearly results that the motor vehicle taxation regime approved establishes that the IUC "became due by the persons who appear in the register as owners of the vehicles" (article 64.º).
11.8 It further adds that invoices alone do not constitute an appropriate document to prove the sale of vehicles, since the same is nothing more than a document unilaterally issued by the Claimant.
11.9 It cites, in this sense, the meaning of the case law of CAAD in cases nos. 63/2014-T, 130/2014-T, 150/2014-T and 220/2014-T.
11.10 As regards default interest, it alleges that, even if it were understood that the tax is not due, there is no error attributable to the service because the Tax Authority merely complied with the provision of no. 1 of article 3.º of the IUC Code, so the legal prerequisites that confer the right to the requested default interest are not met.
11.11 A similar argument is used regarding responsibility for payment of arbitration costs: it was not the Respondent that gave rise to the filing of the request for arbitral pronouncement but rather the Claimant that only submitted documentary evidence of the alleged transfer of ownership after the assessment of the tax.
11.12 Consequently, the Claimant should be condemned to pay the arbitration costs, in line with what was decided in a similar matter under Case no. 72/2013-T of this Arbitration Centre.
Having considered all of the foregoing, it is necessary to render a final decision.
A. FACTS
A.1. Facts Established as Proven
1- The Claimant, in the exercise of its activity, concludes contracts for operational leasing of motor vehicles, proceeding, once the contract ends, to their sale, in accordance with general contractual clauses common to such contracts;
2- Once the contracts end, the Claimant resorts to sales channels (auctioneers and outlets) which, in their capacity as intermediaries, opt not to register the vehicles in their name but only those of third-party buyers;
3- In these situations, as well as in cases of theft or accident, the Claimant sends, together with the invoice, the motor vehicle registration request signed by its legal representatives, so that the entities involved may proceed accordingly, whether through registration of the vehicle in the name of the new owner or cancellation of the registration in case of theft or scrapping;
4- However, the respective buyers did not register their ownership.
5- The Claimant proceeded to the assessment and payment of the IUC, in the total amount of € 1,497.88.
6- In the administrative complaint, the Claimant invoked the transfer of ownership of the vehicles, attaching the respective invoices.
7- In response, the Tax and Customs Authority rejected the complaint and considered that the obligation to pay the tax remained.
B. LAW
B.1 The Exception of Lapse of the Right of Action
In its Response, the Respondent invokes the exception of lapse of the right of action considering that, as the administrative complaint was rejected for being untimely, the notification of that rejection does not admit subsequent challenge, concluding thereby that the request for constitution of the arbitral tribunal is untimely (see articles 5.º to 13.º of the Response).
The lapse of the right of action constitutes a peremptory exception that gives rise to partial or total absolution of the claim, pursuant to no. 2 of article 576.º of the CPC.
The consideration of the timeliness of the administrative complaint results, as alleged in the respective response to the administrative complaint, from the application of the provision of no. 1 of article 70.º of the CPPT which states that the administrative complaint "shall be filed within the period of 120 days counted from the facts provided for in no. 1 of article 102.º", in this case, from the "expiration of the period for voluntary payment of the tax obligations legally notified to the taxpayer".
The Claimant alleges, however, that the period for filing the administrative complaint is two years, pursuant to article 131.º of the CPPT, as this is a situation of self-assessment.
Now, no. 2 of article 16.º of the IUC Code establishes that "The assessment of the tax is made by the passive subject itself through the internet...". It is further added that, in the year of registration or first entry of the vehicle, "the tax is assessed by the passive subject within 30 days following the expiration of the period legally required for its registration" (no. 1 of article 17.º). There is no doubt that, similarly to VAT or Corporate Income Tax, IUC is a self-assessed tax by the passive subject itself.
In accordance with these legal provisions, the Claimant proceeded to self-assess the tax. This would not be the case if the assessment now challenged had been made ex officio by the Tax Authority, which, as alleged and proven, was not the case.
Based on the foregoing, the administrative complaint was timely with respect to all the assessment acts now challenged, so the exception raised is without merit.
B.2 THE PRESUMPTION OF OWNERSHIP OF THE VEHICLE
Given the positions of the Parties assumed in the arguments presented, the central question is whether, on the date of the occurrence of the facts generating the tax (article 3.º no. 1, of the IUC Code) the owners of the vehicles are not those appearing in the register, will it nonetheless be these that will always be considered the passive subjects of the IUC, and whether the ownership revealed by the register will not consequently be considered a rebuttable presumption or, in other words, whether the rule of subjective incidence contained in article 3º no. 1 of the IUC Code establishes or does not establish a presumption.
This matter has already been abundantly dealt with in Arbitral Tax Case Law. See, by way of example, the various decisions of CAAD published at www.caad.org.pt, namely those handed down in cases nos. 14/2013, 26/2013, 27/2013, 73/2013, 170/2013, 294/2013 and 216/2014. In the present judgment we shall follow the understanding and conclusions of those decisions.
For the sake of synthesis and clarity of thought, we adhere without reservation to the framework set out in the arbitral decision in Case no. 216/2014-T, which we cite and to which we refer:
"The general and unanimous sense of such case law is to consider that article 3º-1, of the IUC Code, establishes a rebuttable presumption of ownership the mentions or entries in the Motor Vehicle Registry Office and/or the IMTT database on the date of the tax event.
That is: where the IUC is assessed according to entries in the register or in harmony with the elements in the IMTT databases, the passive subject may exempt itself from payment by demonstrating the non-correspondence between the reality and those entries and elements resorted to by the Tax Authority to proceed with the assessments.
There are no reasons to reverse or alter the essential sense of this case law.
Let us then view, anew and more closely, the matter:
Article 3º of the IUC Code (Code of the Single Circulation Tax) provides:
Article 3º
Subjective Incidence
1 – The passive subjects of the tax are the owners of the vehicles, being considered as such the natural or legal persons, of public or private law, in whose names the same are registered.
2 – Equated to owners are financial lessees, buyers with reservation of ownership, as well as other holders of purchase option rights by virtue of the leasing contract".
For its part, no. 1 of article 11º of the General Tax Law (LGT) establishes that "in the determination of the meaning of tax norms and in the qualification of the facts to which they apply, the general rules and principles of interpretation and application of laws are observed".
Resolving the doubts that arise in the application of legal norms presupposes the carrying out of an interpretative activity.
It is thus necessary to consider what is the best interpretation of article 3º, no. 1 of the IUC Code, in light, first, of the literal element, that is, that in which one seeks to detect the legislative thought that is objectified in the norm, to verify whether the same contemplates a presumption, or whether it determines, definitively, that the passive subject of the tax is the owner appearing in the register.
The question that arises is, in the present case, whether the expression "considered as" used by the legislator in the IUC Code, instead of the expression "presumed", which was the one contained in the decrees that preceded the IUC Code, will have removed the nature of presumption from the legal provision in question.
In our view, and contrary to what the Tax Authority learnedly argues, the answer must necessarily be negative, since from the analysis of our legal system it emerges clearly that the two expressions have been used by the legislator with equivalent meaning, whether at the level of rebuttable presumptions, whether in the context of irrebuttable presumptions, so nothing enables us to draw the conclusion sought by the Tax Authority for a mere semantic reason.
In fact, this happens in various legal norms that establish presumptions using the verb "consider", of which the following are indicated merely by way of example:
~ in the field of civil law - no. 3 of article 243º of the Civil Code, when it establishes that "the third party who acquired the right after the registration of the action of simulation is always considered to be in bad faith, when such registration took place";
~ also in the field of industrial property law the same occurs, when article 59º, no. 1 of the Industrial Property Code provides that "(...)inventions whose patent was requested during the year following the date on which the inventor left the company are considered to have been made during the execution of the employment contract (...)";
~ and, finally, in the field of tax law, when nos. 3 and 4 of article 89-A, of the LGT provide that it is incumbent upon the taxpayer to bear the burden of proof that the declared income corresponds to reality and that, if such proof is not made, it is presumed ("considered" in the letter of the Law) that the income is that which results from the table contained in no. 4 of said article.
This conclusion of there being total equivalence of meaning between the two expressions, which the legislator uses indifferently, satisfies the condition established in article 9.º, no. 2 of the Civil Code, since the minimum of verbal correspondence is ensured for the purposes of determining legislative thought.
It is important next to submit the rule in question to the other elements of logical interpretation, namely, the historical element, the rational or teleological element and the element of systematic order.
Discussing the interpretative activity, Francisco Ferrara states that this "is the most difficult and delicate operation to which the jurist can dedicate himself, and demands fine touch, keen sense, happy intuition, much experience and perfect mastery not only of positive material, but also of the spirit of a certain legislation. (...) Interpretation must be objective, balanced, without passion, daring at times, but not revolutionary, acute, but always respectful of the law" (See Essay on the Theory of Interpretation of Laws, translation by Manuel de Andrade, (2nd ed.), Arménio Amado, Editor, Coimbra, 1963, p. 129).
As Batista Machado states, "the legal provision presents itself to the jurist as a linguistic enunciation, as a set of words that constitute a text. To interpret means evidently to extract from that text a certain meaning or content of thought.
The text admits multiple meanings (polysemy of text) and frequently contains ambiguous or obscure expressions. Even when apparently clear upon first reading, its application to concrete cases of life often gives rise to unforeseen and unforeseeable difficulties of interpretation. Furthermore, although apparently clear in its verbal expression and bearing only one meaning, there is still the possibility that the verbal expression has betrayed the legislative thought – a phenomenon more frequent than it may appear at first glance" (See Introduction to Law and Legitimating Discourse, pp.175/176).
"The purpose of interpretation is to determine the objective meaning of the law, the vis potestas legis (...) The law is not what the legislator wanted or wanted to express, but only that which he expressed in the form of law. (...) On the other hand, the legal command has an autonomous value that may not coincide with the will of the architects and drafters of the law, and may lead to unexpected and unforeseen consequences for the legislators. (...) The interpreter must seek not what the legislator wanted, but what appears objectively desired in the law: the mens legis and not the mens legislatoris (See Francesco Ferrara, Essay, pp. 134/135).
To understand a law "is not merely to grasp mechanically the apparent and immediate meaning that results from verbal connection; it is to inquire deeply into the legislative thought, to descend from the verbal surface to the intimate concept that the text contains and to develop it in all its possible directions"(loc. cit., p.128).
With the objective of unveiling the true meaning and scope of legal texts, the interpreter makes use of interpretative factors which are essentially the grammatical element (the text, or the "letter of the law") and the logical element, which in turn is subdivided into the rational element (or teleological), the systematic element and the historical element. (See Baptista Machado, Loc. Cit., p. 181; Oliveira Ascensão, Law – Introduction and General Theory 2nd Ed., Calouste Gulbenkian Foundation, Lisbon, p.361).
Among us, it is article 9º of the Civil Code (CC) that provides the rules and fundamental elements for the correct and adequate interpretation of norms.
The text of no. 1 of article 9º of the CC begins by saying that interpretation should not confine itself to the letter of the law, but should reconstruct from it the "legislative thought".
On the expression "legislative thought", Batista Machado tells us that article 9º of the CC "did not take a position in the controversy between the subjectivist doctrine and the objectivist doctrine. It proves this by the fact that it does not refer, either to the "will of the legislator" or to the "will of the law", but instead points to as the purpose of the interpretative activity the discovery of "legislative thought" (article 9º, 1º). This expression, purposefully colorless, means exactly that the legislator did not want to commit itself" (loc. cit., p. 188).
In the same sense, P. de Lima and A. Varela pronounce themselves, in an annotation to article 9º of the CC (See Annotated Civil Code – vol. I, Coimbra ed., 1967, p. 16).
And on no. 3 of article 9º of the CC Batista Machado further states: "(...) this no. 3 proposes to us, therefore, a model of ideal legislator that enshrined the most correct (most correct, fair or reasonable) solutions and knows how to express itself correctly. This model clearly bears objectivist characteristics, as it does not take as a point of reference the concrete legislator (so often incorrect, hasty, unfortunate) but an abstract legislator: wise, foresighted, rational and just" (Work and loc. cit. p. 189/190).
Right after this eminent Master draws attention to the fact that no. 1 of article 9º refers to three more elements of interpretation: "the unity of the legal system", the "circumstances in which the law was elaborated" and the "specific conditions of the time in which it is applied" (loc. cit, p. 190).
As for the "circumstances of the time in which the law was elaborated", Batista Machado further explains that this expression "represents what is traditionally called the occasio legis: the conjunctural factors of a political, social and economic nature that determined or motivated the legislative measure in question" (loc. cit., p.190).
Regarding the "specific conditions of the time in which it is applied", this element of interpretation "definitely has an actualist connotation (loc. cit., p. 190) in which it coincides with the opinion expressed by P. de Lima and A. Varela, in the annotations to article 9º of the CC.
With respect to "the unity of the legal system", Baptista Machado considers this the most important interpretative factor: "(...) its consideration as a decisive factor would always be imposed upon us by the principle of the evaluative or axiological coherence of the legal order" (loc. cit., p. 191).
It is also this author that tells us, with regard to the literal or grammatical element (text or "letter of the law"), that this "is the starting point of interpretation. As such, it has from the outset a negative function: to eliminate those meanings that have no support, or at least some correspondence or resonance in the words of the law.
But it also has a positive function, in the following terms: if the text bears only one meaning, that is the meaning of the norm – with the caveat, however, that one can conclude on the basis of other norms that the drafting of the text betrayed the thought of the legislator" (loc. cit., p. 182).
Referring to the rational or teleological element, this author states that it consists "in the reason for being of the law (ratio legis), in the purpose sought by the legislator in elaborating the norm. Knowledge of this purpose, especially when accompanied by knowledge of the circumstances (political, social, economic, moral, etc.,) in which the norm was elaborated or of the political-economic-social circumstances that motivated the legislative decision (occasio legis) constitutes a subsidy of the greatest importance to determine the meaning of the norm. It suffices to recall that the clarification of the ratio legis reveals to us the valuation or weighing of the diverse interests that the norm regulates and, therefore, the relative weight of those interests, the choice among them expressed by the solution that the norm expresses" (loc. cit., pp. 182/183).
With respect to the systematic element (context of the law and parallel provisions), this "element comprises the consideration of the other provisions that form the normative complex of the institute in which the norm being interpreted is integrated, that is, which regulate the same matter (context of the law), as well as the consideration of legal provisions that regulate parallel normative problems or related institutes (parallel provisions). It also comprises the systematic place that corresponds to the norm being interpreted in the overall legal system, as well as its consonance with the spirit or intrinsic unity of the entire legal system.
This interpretative subsidy is based on the postulate of the intrinsic coherence of the legal system, namely on the fact that the norms contained in a codification obey in principle a unitary thought" (Batista Machado, loc.cit., p. 183).
"(...) In particular we must take into consideration the interconnection of the various laws of the country, because a fundamental requirement of all sound legislation is that the laws adjust to one another and do not result in a jumble of disconnected provisions (Joseph Kohler, cited by Manuel de Andrade, in Essay, p. 27).
Descending to the case at hand and to the legal and judicial framework that underlies it:
Through the analysis of the historical element, the conclusion is drawn that, from the entry into force of Decree-Law 59/72, of 30 December, the first to regulate this matter, until Decree-Law no. 116/94, of 3 May, the last to precede the IUC Code [see Law no. 22-A/2007, with the amendments of Law 67-A/2007 and 3-B/2010], the presumption was enshrined [underlined] of the passive subjects of the IUC being the persons in whose names the vehicles were registered on the date of their assessment.
It is thus verified that tax law has, from the outset, had the objective of taxing the true and actual owner and user of the vehicle, being indifferent the use of one or another expression which, as we have seen, have in our legal system a coincident meaning.
The same applies when we resort to elements of interpretation of a rational or teleological nature.
In fact, the current and new framework of motor vehicle taxation establishes principles aimed at subjecting the owners of vehicles to bear the costs of damage to roads and the environment caused by these, as is apparent from the content of article 1.º of the IUC Code.
Now the consideration of these principles, namely the principle of equivalence, which merit constitutional protection and recognition in community law, and are also recognized in other branches of the legal system, determines that the aforementioned costs be borne by the actual owners, the causers of said damage, which entirely rules out an interpretation aimed at preventing the presumed owners from proving that they are no longer such because the ownership is in the legal sphere of another person[1].
Thus, also, from the interpretation carried out in light of elements of a rational and teleological nature, given what the rationality of the system guarantees and the purposes sought by the new IUC Code, it is clear that no. 1 of article 3.º of the IUC Code establishes a rebuttable legal presumption.
In view of the foregoing, it is important to conclude that the ratio legis of the tax points to the direction of taxing the actual owner-users of the vehicles, so the expression "considered as" is used in the normative provision in question in a sense similar to "presumed", for which reason there is no doubt that a legal presumption is enshrined.
On the other hand, article 73º of the LGT establishes that "(...) the presumptions enshrined in the rules of tax incidence always admit proof to the contrary, so they are rebuttable (...)".
Thus, as article 3.º, no. 1 of the IUC Code establishes a presumption juris tantum [and therefore rebuttable], the person who is inscribed in the register as the owner of the vehicle and who, for that reason was considered by the Tax Authority as the passive subject of the tax, may present evidence aimed at demonstrating that the person holding the ownership, on the date of the tax event, is another person, to whom the ownership has been transferred."
2. Proof of Transfer of Motor Vehicles
In view of the foregoing, we conclude that no. 1 of article 3º of the IUC Code establishes a rebuttable presumption, pursuant to article 73.º of the LGT, that the person appearing in the motor vehicle register is its owner. In the present case, the Claimant must prove, in order to rebut the presumption of article 3º, no. 1 of the IUC Code (and even of the Motor Vehicle Register) that it was not the owner of the vehicles in question during the period to which the challenged assessments relate.
To prove that such transfers of ownership occurred through purchase and sale contracts, the Claimant presents copies of invoices.
In its allegations, the Respondent alleges that invoices, as private and unilateral documents, do not constitute sufficient proof to rebut the presumption.
We disagree with this understanding.
It cannot but be noted, from the outset, that the contract for the purchase and sale of a motor vehicle is a verbal contract, not subject, consequently, to any specific form. From this framework results, inevitably, a special importance of the fiscal document not only for tax purposes but also for civil or other purposes.
In the case, the Claimant presented invoices, issued in accordance with legal requirements, evidencing the sale operation. Invoices constitute, for tax purposes, the documents legally required to prove the operations of sales and provision of services, as expressly results from the various tax codes (see the provision of no. 6 of article 23.º of the Corporate Income Tax Code, clause b) of no. 1 of article 29.º and article 36.º of the VAT Code and article 115.º of the Personal Income Tax Code).
It would thus be strange that an invoice constitutes, from the perspective of the seller, sufficient proof to ascertain income from the sale of a vehicle, taxable under Personal Income Tax (in the organized accounting regime) or Corporate Income Tax, but, conversely, should not constitute sufficient proof to prove the same transfer, now for purposes of IUC.
This assertion does not preclude the Tax Authority from demonstrating that it is a false document because there was no actual transfer (with all the fiscal and criminal consequences).
In the present case, there is no proof or even any indication that casts doubt on the presumption of good faith of the taxpayer and of the documents presented, as expressly results from the provision of article 75.º of the General Tax Law.
In conclusion, all necessary prerequisites for the success of the request for annulment of the assessments are met, on the ground of illegality and error in the facts.
C. Default Interest and Arbitration Costs
The Claimant proceeded to full payment of the said IUC assessments, for which reason it requests the reimbursement of these undue amounts, plus default interest, at the legal rate, pursuant to article 43.º of the LGT and 61.º of the CPPT.
In the case at hand, it is manifest that, as a consequence of the illegality of the assessment acts, reimbursement of the tax is in order, by force of the aforementioned articles 24.º, no. 1, clause b), of the RJAT and 100.º of the LGT, as this is essential to "restore the situation that would have existed if the tax act subject of the arbitral decision had not been taken".
As regards default interest, it is also clear that, contrary to what the Respondent alleges, the error is not attributable to the Claimant, from the moment in which, in the context of the administrative complaint, it informed that it was no longer the owner of the vehicle. From this moment, we are dealing with an error in the legal prerequisites, attributable to the Tax Administration.
Consequently, the Claimant is entitled to default interest, pursuant to article 43.º, no. 1, of the LGT and article 61.º of the CPPT, calculated on the amount it paid unduly, from the date of the rejection of the presentation of the administrative complaints until the full reimbursement of that same amount.
On the same grounds, liability for costs is with the losing party because, contrary to what is alleged, the Tax Authority could have proceeded to revoke the assessment acts identified when it became aware of the administrative complaint or within 30 days following notification of the request for constitution of the Arbitral Tribunal (article 13.º no. 1 of the RJAT).
D. DECISION
We hereby decide in this Arbitral Tribunal:
a) We declare well-founded the request for declaration of illegality of the assessments identified as Documents 1 to 14 of the administrative complaint that forms part of the administrative proceedings, in the total amount of € 1,497.88;
b) We condemn the Tax and Customs Authority to the restitution to the Claimant of the amounts paid, with default interest from the date of filing of the administrative complaint until the full reimbursement of the undue tax;
c) We condemn the Tax and Customs Authority to the payment of the costs of the proceedings, in the amount of € 306.00.
E. Value of the Proceedings
The value of the proceedings is set at €1,497.88, pursuant to article 97.º-A, no. 1, a), of the Code of Tax Procedure and Proceedings, applicable by force of clauses a) and b) of no. 1 of article 29.º of the RJAT and of no. 2 of article 3.º of the Regulation of Costs in Tax Arbitration Proceedings.
F. Costs
The amount of the arbitration fee is set at € 306.00, pursuant to Table I of the Regulation of Costs in Tax Arbitration Proceedings, to be paid by the Respondent, as the claim was entirely successful, pursuant to articles 12.º, no. 2, and 22.º, no. 4, both of the RJAT, and article 4.º, no. 4, of the said Regulation.
Notify the parties.
Lisbon, 1 February 2016
The Arbitrator
(Amândio Silva)
[1] The genesis of the tax legal relationship presupposes the cumulative verification of the three prerequisites necessary for its emergence, namely: the real element, the personal element and the temporal element. (In this sense, see, among many other authors, Freitas Pereira, M.H., Taxation, 3rd Edition, Almedina, Coimbra, 2009).
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