Summary
Full Decision
ARBITRAL DECISION
The arbitrator, Dr. Henrique Nogueira Nunes, appointed by the Deontological Council of the Administrative Arbitration Center ("CAAD") to form the Arbitral Tribunal, constituted on 22 September 2016, hereby decides as follows:
1. STATEMENT OF FACTS
1.1. A..., Lda, with tax identification number ..., hereinafter referred to as the "Claimant," has requested the constitution of the Arbitral Tribunal pursuant to articles 2(1)(a) and 10 of Decree-Law No. 10/2011 of 20 January (hereinafter "RJAT").
1.2. The request for arbitral pronouncement concerns the declaration of illegality of the stamp duty tax assessment better identified in the collection documents issued with numbers 2013..., in the amount of € 929.43, 2013..., in the amount of € 929.41 and 2013..., in the amount of € 929.41, effected pursuant to item 28.1 of the TGIS, as amended by article 4 of Law No. 55-A/2012 of 29/12, concerning the year 2012.
1.3. To support its request, the Claimant alleges, in summary, the following defects:
(i) Lack of notification of the stamp duty tax assessment, considering that this never occurred, having only been notified of the stamp duty collection notices.
(ii) Lack of factual and legal grounds and defect of violation of law, considering that the urban property in question in the proceedings is land for construction, not falling within the objective scope provided for in item 28.1 of the General Table of Stamp Duty Tax, as it alleges that this only refers to properties with residential use.
(iii) And that the above-identified equivalence is illegal, as it states, since this has been consistently understood by the Courts and by Arbitral Tribunals.
(iv) And that the effective and definitive use or destination of the land in question in the proceedings for residential purposes cannot be taken as established, since the expression "residential use" presupposes an effective use and not a mere possibility, potentiality or expectation that the property may come to have.
(v) Furthermore, it submits that the assessment in dispute in the proceedings is equally illegal by reason of violation of the principle of double taxation, and unconstitutional by reason of violation of the principle of equality.
(vi) Concluding with the illegality of the assessment which is the subject matter of the claim, seeking its annulment.
1.4. The Tax and Customs Authority, hereinafter referred to as the "Respondent" or "AT," replied to the effect that the request should be dismissed, as it considers that there is no lack of notification of the stamp duty tax assessment, which it states occurred with the notification of the collection documents identified in the proceedings, as well as with respect to the alleged lack of grounds and the violation of the constitutional principle of equality. As to the substantive issue, it states that the concept of properties with "residential use," as worded at the time of the tax facts, for the purposes of item 28 of the TGIS, encompasses land for construction, as urban properties with residential vocation, inasmuch as they were acquired in that capacity, constituting a "plot of land for construction" with areas of building footprint and construction perfectly identified in the urban land registry, wherefore, with the property identified in the proceedings thus classified in terms of land, it concludes by maintaining the tax assessment act and, consequently, by dismissing the Claimant's request.
1.5. The Tribunal, in accordance with what was requested by the Respondent, decided to dispense with holding the first meeting of the Arbitral Tribunal, in accordance with article 18 of the RJAT, which met with no opposition from the Claimant. No exceptions were identified. Both parties were equally dispensed from presenting Arguments. A deadline for pronouncing the arbitral decision was set until 9 January 2017.
1.6. The Tribunal was properly constituted and is competent ratione materiae, in accordance with article 2 of the RJAT.
The parties have legal personality and capacity, appear to be legitimate and are properly represented (cf. articles 4 and 10(2) of the RJAT and article 1 of Order No. 112-A/2011 of 22 March).
No procedural defects were identified.
2. QUESTION TO BE DECIDED
The central (strictly) legal question at issue in these proceedings is whether a plot of land for construction can be qualified as a "property with residential use" and, if so, whether it falls within the scope of item 28.1 of the TGIS, as amended by article 4 of Law No. 55-A/2012 of 29 October.
3. FINDINGS OF FACT
For the purposes of assessing and deciding the merits, the following facts are held to be proven:
A) The Claimant is the owner of 2/10 of an urban property, classified as land for construction, registered in the urban land registry of the parish of ..., municipality of Leiria, under number ... (current ...), with a taxable property value which, on 31.12.2012, was € 1,394,122.80 (cf. Administrative case file submitted by the Respondent).
B) The Claimant was notified of the stamp duty tax assessment better identified in the collection documents issued with numbers 2013..., in the amount of € 929.43, 2013..., in the amount of € 929.41 and 2013..., in the amount of € 929.41, effected pursuant to item 28.1 of the TGIS, as amended by article 4 of Law No. 55-A/2012 of 29/12, concerning the year 2012 (cf. Documents Nos. 1, 2 and 3 submitted with the request for arbitral pronouncement by the Claimant).
C) The Claimant filed a Petition for Reconsideration, which proceeded under number ...2013..., intended to obtain annulment of the tax assessment now in dispute, which was dismissed by the AT – (cf. Information contained in the administrative case file submitted by the Respondent).
D) From that dismissal, and not accepting it, the Claimant filed an Administrative Appeal, which proceeded under number ...2013... and which was equally dismissed by the AT – (cf. Decision submitted by the Claimant as Document No. 4 and contained in the administrative case file submitted by the Respondent).
E) The AT, considering the taxable property value attributed to the land for construction above identified, understood that the objective requirements for the stamp duty tax assessment were met, arising from the amendment to the TGIS of item 28 provided for in Law No. 55-A/2012 of 29 October.
F) On 1 July 2016, the Claimant filed a request for constitution of the Arbitral Tribunal with the CAAD – cf. electronic request in the CAAD system.
4. FACTS NOT PROVEN
There are no facts with significance for the decision on the merits that have not been proven.
5. REASONING AS TO THE FINDINGS OF FACT
As to the essential facts, the settled matter is agreed in identical form by both parties and the Tribunal's conviction was formed on the basis of documentary (official) evidence attached to the proceedings and discriminated above, whose authenticity and veracity were not questioned by either party.
6. LAW
Given the positions assumed by the parties in the briefs presented, the central question to be decided by this arbitral tribunal is to assess the lawfulness of the stamp duty tax assessment for the year 2012.
Having the Claimant attributed various defects to the tax act contested, it is important to determine the order of examination of the same, and the order set forth in article 124 of the CPPT should be observed, applicable pursuant to article 29(1)(a) of the RJAT[1].
The defect of violation of law due to error as to the prerequisites shall be analyzed first, as it is the one that will lead to the "most stable or effective protection of the injured interests," in that its possible procedural success will prevent renewal of the act, which does not occur entirely with the procedural success of some of the remaining defects attributed.
- Regarding error in prerequisites: scope of objective incidence of item 28.1 of the TGIS
Entering into the substantive issue, the assessment which constitutes the immediate subject matter of this arbitral action has its origin in item 28.1 of the TGIS, as amended by article 4 of Law No. 55-A/2012 of 29 October, having as an essential prerequisite being faced with properties that can be classified within the concept of "properties with residential use."
Since in the situation under scrutiny the property in question is exclusively land for construction, devoid of any building, with reference to the year 2012, it is important to determine the meaning of the expression "properties with residential use" in order to conclude whether it encompasses, or not, land for construction.
The matter under analysis has already been the subject of extensive arbitral tax jurisprudence. We refer in particular, without exhaustiveness, to the decisions rendered in the following cases: 42/2013-T of 18-10-2013; 48/2013-T of 09-10-2013; 49/2013-T of 18-09-2013; 53/2013-T of 02-10-2013; 75/2013-T of 01-11-2013; 144/2013-T of 12-12-2013 and 158/2013-T of 10-02-2014.
The Courts have also pronounced on this same question. We refer to the decisions rendered by the Supreme Administrative Court ("STA") in the following cases: 048/14 of 09-04-2014 and 0270/14 of 23-04-2014.
Both the arbitral jurisprudence cited, like the judicial jurisprudence cited, which we follow, considers that land for construction is outside the scope of the provision of item 28.1 of the TGIS, as worded at the date of the facts, in the terms explained below, beginning with an analysis of the legislative context in which the amendment of item 28 to the TGIS occurred.
A. Context of the approval of item 28.1 of the TGIS and its regime
In the parliamentary debate of Bill No. 96/XII (2nd), which was the origin of Law No. 55-A/2012, which amended item 28 to the TGIS, the State Secretary for Tax Affairs stated that:
"(...) For the tax system to promote greater equality, it is essential that the budgetary consolidation effort be shared by all taxpayers and apply to all types of income, with special emphasis on capital income and high-value properties. This matter, it will be recalled, was extensively addressed in the ruling of the Constitutional Court (...).
This proposal has three essential pillars: the creation of special taxation on urban properties valued above 1 million euros; the increase in taxation on capital income on securities gains; and the strengthening of rules to combat tax fraud and evasion.
First, the Government proposes the creation of a special rate to tax residential urban properties of higher value. This is the first time in Portugal that special taxation has been created on high-value properties intended for residential use. This rate will be 0.5% to 0.8% in 2012 and 1% in 2013, and will apply to properties valued at equal to or greater than 1 million euros. With the creation of this additional rate, the tax burden required of these property owners will be significantly increased in 2012 and 2013" (emphasis ours) – cf. Journal of the National Assembly, Series I, No. 9/XXII-2, of 11 October 2012, pp. 31-32.
Both the houses and the residential urban properties referred to here do not equate to land for construction. It is noted that residential urban properties are one of the classification concepts contained in article 6 of the IMI Code, clearly distinct from land for construction. In fact, article 6(1) provides that:
"1 - Urban properties are divided into:
(i) Residential;
(ii) Commercial, industrial or for services;
(iii) Land for construction;
(iv) Other." (emphasis ours)
Thus, residential urban properties and land for construction are, for the purposes of IMI (whose applicability, by cross-reference, to Stamp Duty Tax is, as will be seen below, to be invoked), two distinct categories, with their own legal classifications and definitions contained in article 6 of the IMI Code[2].
In view of the foregoing and as emphasized in the arbitral decision in case No. 75/2013-T of 1 November 2013, it appears clear that "in the spirit of the Bill that gave rise to Law No. 55-A/2012 there was no taxation of land for construction, nor is there any evidence to the contrary from the Deputies who approved the law."
Having established this context, it should be noted that the regime in question came to be approved by Law No. 55-A/2012 of 29 October, and, among several amendments it made to the Stamp Duty Tax Code, it amended item 28 of the TGIS, with the following wording:
"28 – Ownership, usufruct or surface right of urban properties whose taxable property value contained in the registry, in accordance with the Code of Municipal Property Tax (CIMI), is equal to or greater than € 1,000,000 – on the taxable property value used for IMI purposes:
28.1 – For a property with residential use – 1%;
28.2 – For a property, when the taxable persons who are not natural persons are resident in a country, territory or region subject to a clearly more favorable tax regime, as contained in the list approved by ordinance of the Minister of Finance – 7.5%." (emphasis ours)
B. The concept of "property with residential use"
It is thus necessary to interpret the provision of item 28.1 of the TGIS and determine its meaning and scope, given the absence of a legal definition of the concept of property with residential use (a notion fundamental to delineating objective incidence), whether in the Stamp Duty Tax Code itself or in any other statute, including the IMI Code applicable by cross-reference.
In fact, as emphasized in the Arbitral Award relating to case No. 53/2013-T of 2 October 2013, the concept of "property with residential use" is not employed by other tax legislation, in particular, as is relevant to the case, in the Stamp Duty Tax Code and in the IMI Code, the latter being applicable subsidiarily within item 28 of the TGIS, as provided for in articles 2(4); 3(3)(u); 5(u); 23(7); 46(5) and 67(2), all of the Stamp Duty Tax Code.
In the same sense, the Arbitral decision in case No. 144/2013-T of 12 December 2013 refers to the fact that this concept used by item 28.1 (of property with residential use) "not only does not appear defined in any provision of the Stamp Duty Tax Code, but nor is it used in the IMI Code, the statute to which article 67(2) of the STC expressly refers when matters are at issue not regulated in the STC with respect to item 28."
Tax rules must be interpreted like any others, with the conception having been surpassed that they would have the exceptional character that was once attributed to them.
It should be noted in this regard that article 9 of the Civil Code establishes the prevalence of the spirit over the letter of the law, although it has expressly placed the letter as the limit to the search for meaning[3]. Article 9 of the Civil Code represents the emanation of a general hermeneutical principle, and as such has intrinsic validity. This provision states:
"1. Interpretation must not be confined to the letter of the law, but must reconstruct from the texts the legislative intent, having especially in view the unity of the legal system, the circumstances in which the law was drawn up and the specific conditions of the time in which it is applied.
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However, the interpreter cannot take into consideration the legislative intent that does not have a minimum of verbal correspondence in the letter of the law, although imperfectly expressed.
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In fixing the meaning and scope of the law, the interpreter shall presume that the legislator adopted the most sound solutions and was able to express its intent in adequate terms."
The LGT (Tax Code), in its article 11, came, in the specific field of tax laws, to establish a set of rules of interpretation as follows:
"1. In determining the meaning of tax rules and in qualifying the facts to which the same apply, the general rules and principles of interpretation and application of laws are observed.
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Whenever, in tax rules, terms specific to other areas of law are employed, these must be interpreted in the same sense that they have there, unless something else follows directly from the law.
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If doubt persists regarding the meaning of the rules of incidence to be applied, the economic substance of the tax facts must be considered.
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Gaps resulting from tax rules included in the legislative reserve of the National Assembly are not susceptible to filling by analogy."
It appears that the text of the LGT adds nothing, referring to the general rules and principles, in addition to incorporating distinct principles of difficult compatibility.
As seen above, the IMI Code uses (in its article 6(1)) the notion of residential urban properties, which it establishes as an autonomous and distinct category from that of land for construction, but does not provide for the concept of "property with residential use," whose interpretation is now necessary.
At this point, we again have recourse to the arbitral jurisprudence and the Award rendered in case No. 53/2013-T, referenced above, which is endorsed here and from which the following excerpt is transcribed:
"3.2.5. Concept of 'property with residential use' as referring to residential properties
The concept closest to the literal wording of this expression used is manifestly that of 'residential properties,' defined in article 6(2) of the CIMI as encompassing 'buildings or structures' licensed for residential purposes or, in the absence of a license, that have as their normal purpose residential aims.
If one understands that the expression 'property with residential use' coincides with [that] of 'residential properties,' it is manifest that the assessments will be affected by error as to the factual and legal prerequisites, since all properties with respect to which Stamp Duty Tax was assessed under the stated item 28.1 are land for construction, without any building or structure, required to fulfill that concept of 'residential properties.'
Therefore, if one adopts the interpretation that 'property with residential use' means 'residential property,' the assessments whose declaration of illegality is sought will be illegal, because there is no building or structure on any of the land.
However, the non-coincidence of the terms of the expression used in item 28.1 of the TGIS with that which is extracted from article 6(2) of the CIMI points to the sense that it was not intended to use the same concept.
3.2.6. Concept of 'property with residential use' as a concept distinct from 'residential properties'
The word 'use' (afectação), in this context of use of a property, has the meaning of 'the act of assigning something to a certain use.'
'When, as is generally the case, the rules (legislative formulas) bear more than one meaning, the positive function of the text is expressed in giving stronger support to or more strongly suggesting one of the possible meanings. For among the possible meanings, some will correspond to the most natural and direct meaning of the expressions used, whereas others will only fit within the verbal framework of the rule in a forced, contrived manner. Now, in the absence of other elements that would lead to choosing the less immediate sense of the text, the interpreter must, as a general rule, opt for that meaning which best and most immediately corresponds to the natural meaning of the verbal expressions used, and in particular to their technical-legal meaning, on the assumption (not always correct) that the legislator knew how to correctly express its intent.'
The relevance of the text of the law is especially emphasized in the interpretation of rules of incidence of Stamp Duty Tax, which amount to an amalgam, under a common denominator, of an incongruous set of tributes of completely distinct natures (on income, on expenditure, on assets, on acts, etc.), which leaves no appreciable margin for application of the primary interpretive criterion, which is the unity of the legal system, which demands its overall coherence.
The recognized lack of coherence of Stamp Duty Tax is particularly exuberant in the case of this item 28.1, hastily included at the margin of the General State Budget, by a tax legislator with no perceptible overall fiscal orientation, who is implementing successive tax increases as circumstances of budgetary execution problems warrant, of the impositions of international institutional creditors (represented by the 'troika') and of the oversight of the Constitutional Court. (...)
In this context, there being no sure interpretive elements that would allow detection of legislative coherence in the solution adopted in said item 28.1 or the rightness or wrongness of the solution adopted (relevant for interpretive purposes in light of article 9(3) of the Civil Code), the content of the legal text must be the paramount element of interpretation, in accordance with the presumption imposed by article 9(3) itself of the Civil Code, that the legislator knew how to express its intent in adequate terms.
In light of those meanings of the words 'use' and 'to use,' which are 'to give destination' or 'to apply,' the formula used in that item 28.1 of the TGIS clearly encompasses properties that are already applied to residential purposes, whereby it is important to inquire whether it will also encompass properties which, despite not yet being applied to residential purposes, are destined to these and those whose destination is unknown.
In light of the literal content of item 28.1, it is proper to exclude from the scope of incidence of Stamp Duty Tax provided for there land for construction of some Claimants which have not yet had any type of use defined, for it has not yet been applied nor destined to residential purposes. That is, land for construction that does not have a defined use cannot be considered property with residential use, for it does not yet have any use nor any other destination than construction of unknown type. An interpretation to the effect that item 28.1 refers to properties whose use is unknown has not the minimum of verbal correspondence in the letter of that rule, whereby a hypothetical legislative intent of that sort cannot be considered by the law interpreter, in light of the prohibition contained in article 9(2) of the Civil Code.
But this is not enough to clarify the situation of that land for construction which, not yet being applied to residential purposes, already has a determined destination, in particular, in the subdivision license (...).
Therefore, it is necessary to clarify when one can understand that a property is devoted to residential purpose, in particular whether it is when that purpose is assigned to it in a licensing act or similar, or only when the effective assignment of that purpose is concretized.
First, the comparison of item 28.1 of the TGIS with article 6(2) of the CIMI, which defines the concept of residential properties, points manifestly to the need for actual use.
In fact, a building or structure licensed for residential use or, even without a license, but which has residential use as its normal purpose, is, in light of article 6(2), a residential property.
Therefore, on the assumption that the legislator of Law No. 55-A/2012 knew how to express its intent in adequate terms (as article 9(3) of the Civil Code requires that be presumed), if it intended to refer to those properties already licensed for residential use or which have residential use as their normal purpose, it would certainly have used the concept of 'residential properties,' which would express perfectly and clearly its intent, in light of the definition given by article 6(2) of the CIMI.
Consequently, it must be presumed that the use of a different expression is aimed at a distinct reality, whereby, in sound hermeneutics, 'property with residential use' cannot be a property merely licensed for residential use or intended for that purpose (that is, it will not suffice that it be a 'residential property'), but must be a property that already has effective use for that purpose.
That this is the meaning of the expression 'use,' in the same context of classification of properties as is done by the CIMI, is confirmed by article 3 in which, with respect to rural properties, reference is made to those 'which are put to use or, in the absence of concrete use, have as their normal purpose a use generating agricultural income,' which shows that use is concrete, effective. In fact, as is seen from the closing part of this text, a property may have as its purpose a certain use and be or not be put to that use, which shows that use is, at the level of the connection of a property to a certain use, something more intense than mere purpose and which may or may not occur, downstream from this and not upstream.
Moreover, the text of the law in adopting the formula 'property with residential use,' instead of 'urban properties with residential use,' which appears in the said 'Statement of Reasons,' points strongly to the sense that concrete residential use is required, for only then will the property be with that use.
With respect to article 45 of the CIMI, it has no relationship whatsoever with the classification of properties, merely indicating the factors to be considered in the valuation of land for construction. What is considered there, in making reference to the 'building to be constructed,' is the consideration of the destination of the land, which, as has been seen, is something that, in the context of the CIMI, does not imply use and occurs before this.
The correctness of this interpretation to the effect that only properties which are effectively devoted to residential use are inserted within the scope of incidence of item 28.1 of the TGIS is also confirmed by the ratio legis perceptible from the restriction of the field of application of the rule to properties with residential use, in the context of 'the circumstances in which the law was drawn up and the specific conditions of the time in which it is applied,' which article 9(1) of the Civil Code also establishes as interpretive elements.
First, the limitation of taxation in Stamp Duty Tax to 'properties with residential use' makes it discernible that it was not intended to encompass within the scope of incidence of the tax properties with use for services, industry or trade, that is, properties devoted to economic activity, which is understandable in a context in which, as is well known, the economy is in a recessional spiral, publicly proclaimed at the highest level, with unemployment rates reaching maximum historical levels, with an avalanche of business closures derived from economic unsustainability.
Bearing this situation in mind and it being commonly known and public that the revitalization of economic activity and the increase in exports are the exits out of the crisis, it is understandable that legislative measures would not be taken that would hamper economic activity, in particular the increase in tax burden that hinders it and affects competitiveness in international terms.
For this reason, it is to be concluded that the interpretive elements available, including the 'circumstances in which the law was drawn up and the specific conditions of the time in which it is applied,' clearly point to the sense that it was not intended to encompass within the scope of incidence of item 28.1 situations of properties that are not yet devoted to residential use, in particular land for construction held by companies."
In this context, for the reasons just set forth, the understanding advocated by the AT cannot prevail, that the notion of use (residential) of an urban property should be sought in the regime for evaluation of properties contained in article 45 of the IMI Code (which takes into account the use coefficient provided for in article 41 of the same Code).
In fact, as well stated in the decision of arbitral case No. 144/2013-T, "If the primary meaning of 'use,' as we have said, suggests an effective, direct purpose given to a certain asset, we do not see how this understanding can be overturned by the observation that the legislator, within the framework of evaluation of land for construction, permits (assuming it permits) the use of the use coefficient, with a view to what might be built on it."
C. The Case Sub Judice
In accordance with the findings of fact, which are agreed upon, the property underlying the Stamp Duty Tax assessment made, here contested, constitutes land for construction.
Taking as correct and valid (as we do) the understanding that item 28.1 of the TGIS, as worded at the time of the tax fact in question in these proceedings, requires the necessity of an actual residential use of an urban property and not merely potential, land for construction cannot be considered included in that item, as it does not allow, by its very nature, to have an actual and current residential use.
Thus, in the present situation we are not faced with a property with current residential use (to be understood, at the time of the tax fact), whereby Stamp Duty Tax provided for in item 28.1 of the TGIS cannot apply to it, the disputed assessment suffering from error in the prerequisites, embodied in the violation of said item 28.1, and thus the tax assessed should be annulled (cf. article 163 of the CPA, applicable subsidiarily by virtue of articles 2(d) of the CPPT and 29(1)(a) and (d) of the RJAT).
It should be stated that what has been set forth is not affected in any way by the entry into force of Law No. 83-C/2013 of 31 December (State Budget Law 2014) which amended item 28.1 of the TGIS, coming to tax land for construction, inasmuch as this law was not given the nature of an interpretive law, which prevents its application to tax facts occurring prior to its date of entry into force, as occurs in the case of these proceedings.
D. As to the remaining defects attributed: Lack of notification and grounds; unconstitutionality due to violation of the principle of equality and violation of the principle prohibiting double taxation.
Just as has already been previously decided in arbitral proceedings via Case No. 91/2012-T: "The complete procedural success of the defects of violation of law prejudices the examination of formal and procedural defects, as follows from the order of examination of defects provided for in article 124(2) of the CPPT, subsidiarily applicable by virtue of the provision in article 29(1)(a) of the Legal Framework of Tax Arbitration."
In fact, the establishment of an order of examination of defects is only justified by the fact that the possible procedural success of the defects of priority examination would make unnecessary the examination of the remaining ones, for, if it were always necessary to examine all defects, the order of their examination would be irrelevant.
By what has been set forth, with the complete procedural success of the defect of violation of law, thus ensuring more effective protection of the Claimant's rights, the examination of the remaining defects invoked is prejudiced.
7. DECISION
In view of the foregoing, this Singular Arbitral Tribunal hereby decides:
- To grant the request for arbitral pronouncement and declare the annulment of the stamp duty tax assessment better identified in the collection documents issued with numbers 2013..., in the amount of € 929.43, 2013..., in the amount of € 929.41 and 2013..., in the amount of € 929.41, and, likewise, to determine the annulment of the decision that resulted in the dismissal of the Administrative Appeal filed by the Claimant, the same being, consequently, to be entirely granted, in accordance with this Decision.
The value of the case is fixed at Euro 2,788.25, in accordance with the provision of articles 3(2) of the Regulation of Costs in Tax Arbitration Proceedings (RCPAT), 97-A(1)(a) of the CPPT and 306 of the CPC.
The amount of costs is fixed at Euro 612.00, pursuant to article 22(4) of the RJAT and Table I attached to the RCPAT, at the charge of the Respondent, in accordance with the provision of articles 12(2) of the RJAT and 4(4) of the RCPAT.
Notify accordingly.
Lisbon, 26 December 2016.
The Arbitrator,
Dr. Henrique Nogueira Nunes
Text prepared by computer, in accordance with article 131(5) of the Code of Civil Procedure, applicable by cross-reference of article 29(1)(e) of the RJAT.
The wording of this arbitral decision is governed by the spelling rules in effect prior to the 1990 Orthographic Agreement.
[1] Jorge Lopes de Sousa, Comment on the Legal Framework for Tax Arbitration, in Guide to Tax Arbitration, Coord. Nuno Villa-Lobos and Mónica Brito Vieira, 2013, Almedina, p. 202
[2] Article 6(2) to (4) of the IMI Code defines the concepts in question:
"2 – Residential, commercial, industrial or for services are buildings or structures licensed for such purposes or, in the absence of a license, which have as their normal purpose each of these aims.
3 – Land for construction shall be deemed to be land situated within or outside an urban agglomeration, for which a license or authorization has been granted, prior communication admitted or favorable prior information issued for a subdivision or construction operation, and also those which have been so declared in the acquisition title, excepting land in which the competent entities prohibit any of those operations, in particular those located in green areas, protected areas or which, in accordance with municipal land use planning, are devoted to public spaces, infrastructure or facilities. (wording of Law No. 64-A/2008 of 31 December)
4 – Encompassed in the provision of item (d) of (1) is land situated within an urban agglomeration which are neither land for construction nor are encompassed by the provision of article 3(2) and also buildings and structures licensed or, in the absence of a license, which have as their normal purpose other aims than those referred to in (2) and also those excepted in (3)."
[3] See Oliveira Ascensão, "Interpretation of laws. Integration of gaps. Application of the principle of analogy," in Journal of the Bar Association, Year 57 – III, Lisbon, December 1997, pp. 913-941.
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