Process: 250/2015-T

Date: October 28, 2015

Tax Type: Selo

Source: Original CAAD Decision

Summary

Process 250/2015-T concerns a challenge by an investment fund against Stamp Tax assessments totaling €15,086.00 levied on a property in Lisbon under Verba 28.1 of the General Stamp Tax Table (TGIS), introduced by Law 55-A/2012. This provision taxes properties with patrimonial tax values exceeding €1,000,000. The property was divided into five autonomous residential units (1ºA to 5ºA), each below the €1,000,000 threshold individually. The fund's administrator filed arbitration proceedings at CAAD challenging both the assessment procedure and substantive grounds. Procedural challenges included alleged nullity due to lack of proper author identification, insufficient reasoning in the notification violating articles 77 of the Tax General Law (LGT) and 36 of the Tax Procedure Code (CPPT), and failure to clearly state the taxable facts. Substantive arguments contested that: (1) the property lacks residential designation and houses public services under a State lease agreement; (2) the Tax Authority improperly aggregated the values of separate units within a vertical property regime rather than treating each independently; (3) this aggregation methodology violates the constitutional equality principle by creating disparate treatment compared to horizontal property regimes where each unit would be taxed separately; and (4) investment pension funds should benefit from stamp tax exemption under article 49 of the Tax Benefits Statute via article 67 of the Collective Investment Schemes Code (CIS). The arbitral tribunal, constituted as a singular panel under the Legal Regime of Tax Arbitration (RJAT - Decree-Law 10/2011), accepted jurisdiction and dispensed with hearings, finding sufficient documentary evidence for decision.

Full Decision

Case No. 250/2015-T

I – Report

1.1. Fund A..., taxpayer no. ..., administered by B..., S.A., legal entity no. ... (both with registered office at Av. ..., ..., floor ..., Lisbon), having been notified of the decision handed down by the Directorate of Finance of Lisbon in the voluntary complaint proceedings no. ... 2014 ..., which dismissed the voluntary complaint filed against the assessment acts nos. 2012 ..., 2012 ..., 2012 ..., 2012 ... and 2012 ..., of 17/7/2013, and the respective collection notices for Stamp Tax, relating to the year 2012, levied on the property registered in the property matrix of the parish of ..., municipality and district of Lisbon, under article ... (formerly ... of the parish of ...) (1.ºA to 5.ºA), and made pursuant to item 28 of the General Stamp Tax Table introduced by Law No. 55-A/2012, of 29/10, in the total amount of €15,086.00, corresponding to the sum of the respective amounts of €3,334.60 (1.ºA), €3,209.20 (2.ºA), €3,209.20 (3.ºA), €2,972.80 (4.ºA), €2,360.20 (5.ºA), filed, on 14/4/2015, a request for the constitution of an arbitral tribunal and for an arbitral decision, pursuant to the provisions of subparagraph a) of article 2, number 1, subparagraph a) of article 10, number 1, and article 15 et seq., all of Decree-Law No. 10/2011, of 20/1 (Legal Regime of Arbitration in Tax Matters, hereinafter referred to as "RJAT"), in which the Tax and Customs Authority ("AT") is the Respondent Entity, seeking, in summary, the "challenge of the [referred decision] and the assessment acts in question", on the ground that the defects identified in points a) to g) of the conclusions contained in the request for arbitral decision occurred (and which are hereby considered, for due purposes, reproduced).

1.2. On 25/6/2015, this Singular Arbitral Tribunal was constituted.

1.3. On 25/6/2015, the AT was served, as the respondent party, to submit a response, pursuant to article 17, number 1, of the RJAT. The AT submitted its response on 9/9/2015, having argued, in summary, that the Claimant's request was wholly unfounded.

1.4. By order of 22/10/2015, the Tribunal considered the hearing provided for in article 18 of the RJAT to be dispensable, as well as the production of witness evidence requested by the Claimant, because the proceedings contained all elements necessary for the decision. The Tribunal further fixed the delivery of the decision for 28/10/2015.

1.5. The Arbitral Tribunal was duly constituted, is materially competent, the proceedings do not suffer from defects that would invalidate it, and the Parties have legal personality and capacity, being duly constituted.

II – Allegations of the Parties

2.1. The Claimant alleges, in its initial petition, that: a) "[the notification] does not state the author of the act, nor the competence under which it was performed, which gives rise to its nullity [nor] does it contain its reasoning"; b) "[the notification is] ineffective in relation to the Claimant by omission of [reasons, as provided in article 36, numbers 1 and 2 of the CPPT"; c) "the notification/communication directed to the Claimant is not [...] clear, and is not surely complete at least as to the facts [...] and the reason for the same is totally imperceptible [since] the fact that integrates the rules of incidence is not mentioned"; d) "By lacking the necessary reasoning, the notified/communicated act violates, in particular, the provisions of article 77 of the LGT, being consequently invalid, ineffective and voidable"; e) "the subjective and objective tax legal situation is not subsumable under the tax incidence rules set out in subparagraphs a) to f) of number 1 of article 6 of Law No. 55-A/2012"; f) "the property in question has not, and never had, any residential designation, nor in filling out the form for registration in the matrix was this purpose declared, doc. no. 18"; g) "the Tax Authority is part of the Legal Entity (State) intervening in the actual lease agreement [relating to public services that the property in question houses], is an act of its own, of which it is obliged to be aware both by being part of the State and because it was expressly notified, and which makes the assessment of the tax unlawful and prohibited"; h) "the property in question, in March 2013, was divided by the AT into physically and fiscally independent floors, with an existing physical allocation of areas both for the fixing of its purpose, in the case of housing and commerce, and for its patrimonial value"; i) "The AT considered that, once five of the six floors have residential designation and the sum of their respective VPT amounts to more than €1,000,000.00, there was cause for stamp tax incidence. Thus, from the point of view of the Tax Authority, for a property not constituted in horizontal property regime, the criterion for determining stamp tax incidence is the global VPT of the floors and divisions intended for housing. Now, it is precisely with this understanding that the Claimant cannot agree, since the mode, vertical or horizontal, in which property is constituted is not relevant"; j) "The AT cannot [...] take into account the entirety of the value corresponding to the sum of VPTs of autonomous areas with the same nature, and belonging to the same building and to the same taxpayer, to consider the tax incidence requirement fulfilled which provides for special increased taxation on properties with more than €1,000,000.00 of Patrimonial Tax Value"; l) "Even if the property is designated for housing, without admitting so, the VPTs in question are manifestly lower, each of them, than the value of €1,000,000.00 [...] provided in item 28.1 of the General Stamp Tax Table [...] [so that] the AT cannot subject these units, or the property, as a whole, constituted in vertical property regime, to stamp tax under the said item"; m) "The stamp tax assessments that are now being challenged clearly violate the principle of equality, provided [...] in article 13 of the Constitution of the Portuguese Republic (CRP)"; n) "the AT cannot distinguish where the legislature itself understood it should not, under penalty of violating the coherence of the tax system, as well as the principle of tax equality, provided in article 103, number 2, of the CRP, and also the principles of tax justice, equality and proportionality. [...] the non-annulment of these assessments clearly violates this principle, since it implies unequal taxation of the Claimant, compared to a situation in which the property is held in horizontal property regime"; o) "[Given] the provisions of article 49 of the Statute of Tax Benefits (applicable via article 67 of the CIS) [...] [even] if it were concluded that the Claimant Pension Fund was objectively covered in the scope of objective incidence, it would have to be concluded that it was subjectively covered by the exemption from stamp tax in question."

2.2. The Claimant concludes that, in light of the above, it should be: "a) declared the non-existence of the assessment by non-existence of its author, its essential element, or if it is understood that the violation of law that occurred does not lead to the non-existence of the act, the annulment of the same, or its ineffectiveness; b) if this is not so understood, annul the assessment on the ground of violation of law based on the lack of (i) reasoning for the same, and (ii) the non-existence of an incidence rule, whether objectively or temporally, or the existence of subjective exemption; c) consider unlawful, and annul the assessment on the basis of the actual non-residential purpose of the property in question; d) or, even if this is not understood, consider the assessment unlawful, and annul it, since the basis of tax incidence should be the patrimonial value of each independent area, and not the sum of independent areas, from which it follows that, given the fact that the values do not reach the taxable minimums, there is no place for the tax obligation assessed; e) or further, judge the assessment unlawful because, on the date legally fixed for the assessment of the tax in question, the VPT to be taken into account (2011) does not reach the taxable value; f) if this is not so understood, let the nullity of the collection notices be declared by omission of the duty to identify the author of the act, the competences under which the same was performed, and lack of reasoning; g) lastly, and if none of the reasons invoked proceed, let the assessment be annulled by virtue of the tax rate to be applied being 0.5% for the year 2012 and not 1%."

2.3. For its part, the AT alleges, in its reply, that: a) "The Claimant, from reading this rule, immediately discards an important element of the tax fact that is contained in the body of item 28, namely the ownership of properties, according to the vpt contained in the matrix [...]. [...] it is to the patrimonial tax value contained in the matrix that the text of the law directs attention to determine the incidence of stamp tax in item 28 of the GSTF, as well as to the type and classification of the property as it appears in the matrix"; b) "In these terms, the rule for assessing CIS operates, that is, article 113, number 1, of the CIMI "ex vi" of article 23 of the CIS, states that the tax is assessed annually, based on the patrimonial tax values of the properties and in relation to the taxpayers that appear in the matrices on 31 December of the year to which it relates. Now, as can be verified in the property ledger of the property in question, its designation is residential"; c) "having the assessment of IS based on the matrix, and if this, on 31 December 2012, refers to the residential designation of the property, the requirements for taxation under item 28 of the CIS are met"; d) "the property in question, for tax purposes, is designated for housing, so that the stamp tax assessment acts under item 28.1 of the GSTF are not unlawful because they did not violate the said incidence rule"; e) "the Claimant, for purposes of IMI and also of stamp tax, by virtue of the wording of the said item, is not the owner of 15 autonomous fractions, but rather of a single property"; f) "The unity of the urban property in vertical property regime composed of several floors or divisions is not, however, affected by the fact that all or part of those floors or divisions are capable of independent economic use. Such property does not cease, by the fact of being one only, not being, thus, its distinct parts legally equated to autonomous fractions in a horizontal property regime."; g) "The fact that the IMI was calculated according to the patrimonial tax value of each part of property with independent economic use does not likewise affect the application of item 28, number 1, of the General Table. This is what results from the fact that the determining factor for the application of that item of the General Table is the total patrimonial value of the property and not separately that of each of its parcels. Any other interpretation would violate, and rightly so, the letter and spirit of item 28.1 of the General Table and the principle of legality of the essential elements of the tax provided in article 103, number 2, of the Constitution of the Portuguese Republic (CRP)"; h) "It is, thus, unconstitutional, as offensive to the principle of tax legality, the interpretation of item 28.1 of the General Table, in the sense that the patrimonial value on which its incidence depends is calculated globally and not floor by floor or floor or division by division."; i) "[the] discrimination [between properties in horizontal and vertical property regimes] may also be imposed by the need to impose coherence on the tax system. The fact that the Claimant legitimately disagrees with that discrimination does not imply the violation of any constitutional principle"; j) "procedural rules of evaluation, matrix registration and assessment of the parts capable of independent use do not allow it to be stated that there is an equation of the property in total property regime with the vertical property regime"; l) "The tax fact of stamp tax under item 28.1, consisting of the ownership of urban properties whose patrimonial tax value contained in the matrix, under the terms of the CIMI, is equal to or greater than €1,000,000.00, the patrimonial value relevant for purposes of tax incidence is, thus, the total patrimonial value of the urban property and not the patrimonial value of each of the parts that compose it, even when capable of independent use"; m) "the Claimant's request that the horizontal property regime be applied by analogy to its property, considering that each of the fractions capable of independent use constitutes a property, does not succeed, since this would not be interpreting the rules of the CIMI, and consequently of the CIS, it would be subverting the entire regime established therein"; n) "the tax acts in question, in terms of substance, did not violate, thus, any legal or constitutional provision, and should, thus, be upheld"; o) "As for the other arguments presented by the Claimant, they are contradicted in the information that analysed the voluntary complaint, so we dispense with its analysis at this stage, referring thereto."

2.4. The AT concludes, from the above, that it cannot "at all, agree with any of the [...] arguments" invoked by the Claimant.

III – Proven, Unproven Facts and Their Reasoning

3.1. The following facts are considered proven:

i) The Claimant is the owner of the urban property registered in the property matrix under article ..., of the parish of ..., municipality and district of Lisbon, it being that such property is constituted in a regime of total/vertical property.

ii) The property is composed of 15 divisions capable of independent use, consisting of 10 shops and 5 floors. The designation of the property is, according to the data contained in its respective property ledger, "Housing" for fractions 1.ºA, 2.ºA, 3.ºA, 4.ºA and 5.ºA, and "Commerce" for fractions LJ3, LJ6, LJ8, LJ10, LJ12, LJ18, LJ20, LJ22, LJ24 and LJ26. The mentioned property was subject to an evaluation on 4/3/2013, with effects reported to the date of receipt of the mod. 1 declaration for IMI (31/12/2012). The result thereof was notified to the Claimant on 27/3/2013 (and the latter did not contest it).

iii) The assessments in question are based on the residential VPT contained in the matrix on the date of 31/12/2012 [€1,508,600.00 = €3,334.60 (1.ºA) + €3,209.20 (2.ºA) + €3,209.20 (3.ºA) + €2,972.80 (4.ºA) + €2,360.20 (5.ºA)], having the AT assessed Stamp Tax under item 28.1 of the GSTF, as worded by article 4 of Law No. 55-A/2012, of 29/10, at the rate of 1% (= €15,086.00).

iv) The subjection to Stamp Tax under item 28.1 of the GSTF resulted, according to the AT (see point 6 of its response), from the combination of two facts: the designation being residential and the patrimonial value (of the entirety of the 5 respective fractions) of the urban property registered in the matrix being equal to or greater than €1,000,000.00. However, none of the 5 divisions/fractions of independent use of the said property has a VPT equal to or greater than €1,000,000.00 (see above, point iii), and docs. attached to the request for arbitral decision).

v) Dissatisfied with the said assessments, the Claimant filed, on 26/3/2014, a voluntary complaint, which was dismissed by Order of 12/1/2015.

vi) Dissatisfied with the said Order of dismissal, the Claimant filed the present request for arbitral decision on 14/4/2015.

3.2. There are no unproven facts material to the decision of the case.

3.3. The facts considered relevant and proven (see 3.1) are based on the analysis of the positions exposed by the parties and the documentary evidence attached to the proceedings.

IV – On the Law

The essential question raised in this proceeding is whether the limit of €1,000,000.00, referred to in item 28.1 of the GSTF, should be assessed based on the total patrimonial value of the property (in a regime of total/vertical property) or based on the value of each of its respective fractions of independent use.

On this specific question there has already been abundant arbitral case law (see, by way of mere example, the Arbitral Decisions in cases nos. 50/2013-T, of 29/10/2013, 295/2014-T, of 21/11/2014, and 818/2014-T, of 14/5/2015), in uniform and general terms, with which we agree here. However, for better clarification of the position adopted, the following excerpt from the Arbitral Decision handed down in case no. 194/2014, of 28/7/2014, shall be cited, in the part considered relevant:

"The concept of 'properties with residential designation' used in item 28.1 is not expressly defined in any provision of the CIS nor in the CIMI, a statute to which article 67, number 2, of the CIS refers.

In the case at hand, whether one takes into account each of the Claimant's properties in vertical property regime or each of its respective divisions endowed with autonomy, these are (not disputed) properties classified as urban and residential according to the criteria established in articles 2, 4 and 6 of the Real Property Tax Code, applicable by referral of article 67 of the CIS.

Thus, only the exact meaning of the segment 'patrimonial value considered for purposes of IMI', contained in the tax incidence rule in the body of item 28 of the GSTF, is at issue: in the case of properties in total property but with floors or divisions capable of independent use, the relevant VPT corresponds to the sum of the VPT of the various divisions/floors, as the AT claims, or should what be taken into account is the VPT of each of the respective autonomous floors or divisions, as the Claimant argues?

[...]. [Each] property, in the terms conceptually defined by article 2 of the CIMI, corresponds to a single entry in the matrix (number 2 of article 82 of the CIMI) but, according to number 3 of article 12 of the same Code, referring to the concept of property matrix (registration of the property, its characterization, location, VPT and ownership), 'each floor or part of property capable of independent use is considered separately in the matrix registration, which discriminates the respective patrimonial tax value', not taking as reference the sum of the patrimonial values attributed to the autonomous parts of the same property, but the value attributed to each of them individually considered.

As for the assessment of IMI – application of the rate to the tax base – article 119, number 1, provides that 'the competent collection document' contains the 'discrimination of properties, its parts capable of independent use, respective patrimonial tax value and the tax payable (...)'.

That is, the rule is autonomization, the characterization as 'property' of each part of a building, insofar as it is functionally and economically independent, capable of independent use, in accordance with the concept of property defined immediately in number 1 of article 2 of the CIMI: property is every fraction (of territory, encompassing waters, plantations, buildings and constructions of any nature incorporated therein or based thereon, with a character of permanence) insofar as it forms part of the patrimony of a natural or legal person and, under normal circumstances, has economic value, as well as waters, plantations, buildings or constructions, in the circumstances above, endowed with economic autonomy [...].

Thus, when number 4 of article 2 provides that 'For purposes of this tax, each autonomous fraction, in the horizontal property regime, is considered as constituting a property', it does not properly establish an exceptional or special regime for properties in horizontal property.

After all, each building in horizontal property (article 92 of the CIMI) has only one single matrix entry (number 1), describing the building generically and mentioning the fact that it is in horizontal property regime (number 2) and matrix autonomy is realized in the attribution to each of the autonomous fractions, described in detail and individualized, of a capital letter, according to alphabetical order (number 3). This seems to be the specificity of buildings in horizontal property; in other cases, of properties in vertical or total property, divisions or floors with autonomy but without the status of horizontal property, the matrix also consecrates autonomy but evidencing the units with indication of the type of floor/story.

[...]. [It] is not convincing the argument [...] that in the case of properties in total property, even with floors or divisions capable of independent use, although the IMI is assessed in relation to each part capable of independent use, the patrimonial tax value on which the incidence of Stamp Tax in item no. 28.1 of the General Table depends had to be, as it was, the global patrimonial value of the properties, and not that of each of its autonomous floors or independent parts, because item no. 28.1 of the GSTF is applied according to the rules of the CIMI but 'with reservation of aspects that require due adaptations' [...]. The question is that, precisely, the reason why the 'adaptations' to the rules of the CIMI advocated by the AT must be accepted requires demonstration.

All said, no reason appears to be found for, in the matter of incidence of Stamp Tax provided in item 28.1 of the GSTF, giving to fractions of properties in 'vertical property', endowed with autonomy, treatment different from that granted to properties in horizontal property, when in either of those situations the IMI is applied to the patrimonial value evidenced in the matrix for each of the autonomous units." [End of citation.]

In the same sense, see, for example, the Arbitral Decision handed down in case no. 518/2014-T, of 20/2/2015: "pursuant to item 28.1 of the GSTF, the incidence in stamp tax, in cases of urban properties in total property with floors or divisions capable of independent use, respects each floor or division with independent use for residential designation with patrimonial tax value equal to or greater than €1,000,000. [...] this interpretation shows[-itself] particularly peremptory in a case like the present in which the property in question has parts capable of independent use with designation for housing and parts capable of independent use with designation for services and commerce [...]. [...] the interpretation thus made of item 28.1 of the GSTF, according to which, in cases of properties in total property with floors or divisions capable of independent use, one should pay attention to the patrimonial tax value proper to each floor or division with residential designation contained in the competent matrix, is the one that best harmonizes with the principles of equality and contributive capacity (cf. article 13 and article 104, number 3, of the CRP), and that, therefore, most perfectly adapts to the ratio legis that seems to preside over the creation of this item in IS of 'distribution of sacrifices' through taxation in IS of 'properties of high value intended for housing'".

Agreeing with the cited reasoning and applying it to the present case, it is concluded that the Respondent is not right, since it is concluded that: 1) for purposes of the assessment of Stamp Tax provided in item 28.1 of the GSTF, the VPT determined in accordance with the CIMI must be taken into consideration, that is, in the concrete case of properties in total property with floors or divisions of independent use, in accordance with the individual VPT of each of the floors or divisions of independent use; 2) the assessments challenged by the Claimant suffer from the defect of violation of law, given that none of the divisions of independent use of the property in question has VPT equal to or greater than €1,000,000.00 (see docs. attached to the request for arbitral decision), for which reason Stamp Tax should not be levied on them under item 28.1 of the GSTF.

Showing the understanding of the Claimant regarding the said essential question to be justified, it becomes unnecessary, bearing in mind the provisions of article 124 of the CPPT (ex vi article 29, number 1, of the RJAT), to verify the justification of other alleged defects in the Stamp Tax assessments now being challenged.

V – DECISION

In light of the above, it is decided:

  • To judge the request for arbitral decision well-founded.
  • To annul the (five) Stamp Tax assessments identified with nos. 2012 ..., 2012 ..., 2012 ..., 2012 ... and 2012 ..., to which there corresponded, respectively, the collection notices with nos. 2013 ..., 2013 ..., 2013 ..., 2013 ... and 2013 ....

The case value is fixed at €15,086.00 (fifteen thousand and eighty-six euros), pursuant to articles 32 of the CPTA and 97-A of the CPPT, applicable by virtue of the provisions of article 29, number 1, subparagraphs a) and b), of the RJAT, and article 3, number 2, of the Regulation of Costs in Tax Arbitration Proceedings (RCPAT).

Costs to be borne by the Respondent, in the amount of €918.00, pursuant to Table I of the RCPAT, and in compliance with the provisions of articles 12, number 2, and 22, number 4, both of the RJAT, as well as the provisions of article 4, number 4, of the cited Regulation.

Notify.

Lisbon, 28 October 2015.

The Arbitrator,

Miguel Patrício

Text prepared by computer, pursuant to the provisions of article 131, number 5, of the CPC, applicable by referral of article 29, number 1, subparagraph e), of the RJAT.

The wording of this decision is governed by the orthography prior to the Orthographic Agreement of 1990.

Frequently Asked Questions

Automatically Created

What is the Stamp Tax (Imposto do Selo) under Verba 28.1 of the TGIS on high-value properties in Portugal?
Verba 28.1 of the General Stamp Tax Table (TGIS) established a special annual Stamp Tax on real estate properties for residential use with patrimonial tax values (VPT) exceeding €1,000,000. Introduced by Law No. 55-A/2012 of October 29, this tax applies at progressive rates based on property value thresholds. It represents additional taxation on high-value residential real estate beyond standard property taxes (IMI). The tax base is the patrimonial tax value registered in the property matrix, and liability arises on January 1st of each year for properties meeting the value and residential use criteria.
Can an investment fund challenge Stamp Tax assessments on individual property units through tax arbitration at CAAD?
Yes, investment funds have legal standing to challenge Stamp Tax assessments through the Center for Administrative Arbitration (CAAD) under the Legal Regime of Tax Arbitration (RJAT - Decree-Law 10/2011). In this case, Fund A... successfully initiated arbitration proceedings under articles 2(1)(a), 10(1)(a), and 15 et seq. of the RJAT to contest assessment acts issued under Verba 28.1. Investment funds, through their management companies, can file arbitration requests within the statutory deadlines, challenging both procedural defects and substantive grounds. The arbitral tribunal has material jurisdiction to review stamp tax disputes involving collective investment schemes, including issues of tax incidence, exemptions, and constitutional compliance.
What are the legal grounds for contesting Stamp Tax liquidation notices issued under Law 55-A/2012?
Legal grounds for contesting Stamp Tax assessments under Law 55-A/2012 include: (1) procedural violations such as lack of proper notification, absence of reasoning, or failure to identify the author of the administrative act (violating articles 77 LGT and 36 CPPT); (2) substantive challenges regarding objective tax incidence—arguing the property doesn't meet residential use requirements or that the property's actual purpose excludes it from taxation; (3) incorrect calculation methodology, particularly regarding aggregation of values in vertical property regimes versus individual unit valuations; (4) constitutional violations, especially breach of the equality principle (articles 13 and 103(2) of the Portuguese Constitution) when taxpayers face disparate treatment compared to horizontal property owners; and (5) subjective exemptions, such as investment funds' eligibility for stamp tax exemption under article 49 of the Tax Benefits Statute via article 67 of the Collective Investment Schemes Code.
How does the CAAD arbitral tribunal process work for disputes involving Stamp Tax on real estate?
The CAAD arbitral tribunal process for Stamp Tax disputes follows the RJAT procedure: (1) the taxpayer files a request for constitution of an arbitral tribunal within the statutory deadline following administrative dismissal of their complaint; (2) the tribunal is constituted (singular or collective panel) within legal timeframes; (3) the Tax Authority is notified and must submit a response within the prescribed period; (4) the tribunal may order hearings or dispense with them if the documentary evidence suffices for decision; (5) parties may request witness testimony or additional evidence, subject to the tribunal's relevance assessment; (6) the tribunal issues a binding arbitral award within six months of constitution; and (7) the decision addresses jurisdiction, procedural regularity, party standing, and merits. This process provides an alternative to judicial courts with specialized tax expertise and typically faster resolution.
What notification requirements must the Tax Authority meet when issuing Stamp Tax assessments on properties?
When issuing Stamp Tax assessments, the Tax Authority must comply with notification requirements under articles 77 of the Tax General Law (LGT) and 36 of the Tax Procedure Code (CPPT). Notifications must: (1) identify the author of the administrative act and the legal competence under which it was performed; (2) contain sufficient reasoning explaining the factual and legal grounds for the assessment, including identification of the taxable facts that trigger the tax obligation; (3) clearly state which tax incidence rules apply and why the taxpayer's situation falls within their scope; (4) specify the legal provisions supporting the assessment; and (5) inform taxpayers of appeal rights and deadlines. Failure to meet these requirements may result in nullity, ineffectiveness, or voidability of the assessment act, providing grounds for successful challenge in administrative complaint or arbitration proceedings.