Summary
Full Decision
ARBITRAL TAX JURISPRUDENCE
Case No. 459/2018-T
Decision Date: 31-08-2020
ISP
Value of Claim: € 92,716.83
Subject Matter: Colored and marked diesel oil. Tax on Petroleum and Energy Products (ISP), Road Service Contribution (CSR). Formalities – Reform of Arbitral Decision (attached to decision).
Replaces the arbitral decision of 26 January 2019.
ARBITRAL DECISION
The arbitrators Adv. Jorge Lopes de Sousa (arbitrator-president), Prof. Doctor Fernando Borges de Araújo and Dr. António Alberto Franco (arbitrators members), appointed by the Deontological Council of the Administrative Arbitration Center to form the Arbitral Tribunal, constituted on 28-11-2018, hereby agree as follows:
1. Report
A... LDA, legal entity no. ..., with headquarters in ..., ...-... ... (hereinafter referred to as "Claimant"), came forth, pursuant to Decree-Law No. 10/2011, of 20 January (hereinafter "RJAT"), requesting the constitution of an Arbitral Tribunal.
The Claimant seeks the annulment of Assessment No. ..., dated 01-08-2018, in the total amount of € 92,716.83, relating to Tax on Petroleum and Energy Products (ISP), Road Service Contribution (CSR) and Compensatory Interest (JC) arising from the Inspection identified by Case OI2018....
The Claimant further requests reimbursement of the aforementioned amount, plus indemnificatory interest.
The Respondent is the TAX AND CUSTOMS AUTHORITY.
By judgment of 26-01-2019, the following was decided:
a) To partially uphold the request for arbitral pronouncement;
b) To partially annul Assessment No. ..., in the amount of € 390.89;
c) To order the Tax and Customs Authority to reimburse the Claimant in the amount of € 390.89;
d) To reject the request for indemnificatory interest and to absolve the Tax and Customs Authority from this request.
An appeal was lodged with the Constitutional Court by the Claimant.
In judgment No. 130/2020, dated 03-03-2020, delivered in case No. 612/2019, the Constitutional Court held "to declare unconstitutional, by violation of articles 18, No. 2 and 61, No. 1, of the Constitution, the normative segment of No. 5 of article 93 of the Code of Excise Duties on Consumption, as amended by Law No. 82-B/2014, of 31 December, which determines as responsible for payment of the amount of tax resulting from the difference between the tax level applicable to road diesel oil and the rate applicable to colored and marked diesel oil, the owner or legal person responsible for the operation of authorized fuel stations for public sale, in relation to quantities sold to holders of electronic cards for which the corresponding invoices are not issued in the name of the card holder."
Although the Arbitral Tribunal was dissolved with notification of filing made on 28-02-2019, pursuant to the provision in article 23 of the RJAT, No. 2 of article 80 of the Organization, Operation and Procedure of the Constitutional Court establishes that "if the Constitutional Court grants the appeal, even if only in part, the case files shall be returned to the court from which they came, so that this court, as appropriate, shall reform the decision or order it to be reformed in accordance with the judgment on the question of unconstitutionality or illegality," which implies that the arbitral tribunal shall be reconstituted for this purpose.
2. Statement of Facts
In the arbitral judgment of 26-01-2019, the facts were decided as follows.
2.1. Proven Facts
The following facts are considered proven:
A) A tax inspection was conducted by the Customs Authority of ... on the Claimant regarding the activity of acquisition and sale, in the years 2015, 2016 and 2017, of Colored and Marked Diesel Oil intended for agriculture, hereinafter designated "GCM";
B) In that inspection, the Tax Inspection Report was drawn up, which is contained in document No. 1 attached with the request for arbitral pronouncement, whose content is reproduced herein, wherein it is stated, among other things, the following:
A) CONCERNING THE FACTS ESTABLISHED
The operator operates this fuel supply station (PAC), located in ... – ...;
During this period, various situations were identified that constitute non-compliance with normative rules, which we will develop throughout this report;
A1) – SALES NOT PROPERLY RECORDED IN THE TPA
In order to aggregate all the information presented in the previous point, summary tables are presented for the year, concerning sales that were not properly recorded in the TPA, whose quantities are summarized as follows:
A2) – SALE TO NON-CARDHOLDER
During the period under analysis, the company sold agricultural diesel to customers who, as of the date of the supply, according to information obtained from the DGADR Database, were not holders of active microchip cards, as shown in the table in chapter V.
A3) – DETERMINATION OF TAX DEBT UNDER ISP – LEGAL BASIS
Considering Decree-Law No. 73/2010 of 21 June, which approves the new Code of Excise Duties on Consumption (CIEC).
Considering Decree-Law No. 73/2010 of 21 June, which approves the new Code of Excise Duties on Consumption (CIEC), repealing as of its entry into force on 21 July Decree-Law No. 566/99, of 22 December.
Considering that fuels in general and diesel oils in particular are subject to Tax on Petroleum and Energy Products (ISP), according to the provisions of article 5 and letter a) of No. 1 of article 88 of the CIEC.
Considering that, according to articles 1, 3 and 5 of article 93 of the CIEC, colored and marked diesel oils acquired by holders of the electronic card established for the purposes of monitoring allocation to authorized destinations are taxed at a reduced rate.
Considering that, according to the provision in No. 5 of article 93 and letter h) of No. 2 of article 4 of the CIEC, the owner or legal person responsible for the operation of authorized fuel stations for public sale of GCM is responsible for payment of the amount of tax resulting from the difference between the tax level applicable to road diesel oil and the level applicable to GCM, concerning quantities sold that are not properly recorded in the computer system associated with the assigned electronic cards.
Considering that, pursuant to No. 3 of article 11 of the CIEC, in the event of an irregularity that prejudices tax collection, the competent customs authority shall proceed to assess and notify the respective taxpayer.
Considering that the assessment is based on No. 5 of article 93 of the CIEC, combined with No. 5 of Ordinance No. 361-A/2008, of 12 May, that is, the tax to be assessed results from the difference between the tax level applicable to road diesel oil and the rate applicable to GCM, in relation to quantities sold and not properly recorded in the computer system underlying the assigned microchip cards.
Considering that in the years 2015, 2016 and 2017, quantities of GCM were identified as sold and not properly recorded in the cards of the purchasers.
Considering that quantities of GCM were identified as sold to non-card holders. Tax assessment should then be proceeded with concerning ISP due for sales of GCM effected during the indicated period, for which the corresponding records were not made in the POS/TPA:
Pursuant to No. 3 of article 11 of the CIEC, a subsequent assessment shall be recorded, whereby the competent tax assessment form (IL) should be processed in the total amount of 86,819.94 € (as shown in chapter VI), plus the respective compensatory interest, calculated pursuant to article 35 of the General Tax Law (LGT), approved by Decree-Law No. 398/98.
The taxpayer exercised the right to prior hearing, as related in section IX of this report.
On the ISP established, as well as on the sales value concerning quantities transacted in GCM that were not properly recorded in the electronic control system and which are identified in this report, VAT shall also be due, to be assessed by the Finance Department of....
With respect to the irregularities, these are described in chapter VII of this report.
According to the provision in letter h) of No. 2 of article 4 of the CIEC, the taxpayer is the economic operator A... LDA. – Tax ID Number...
(...)
2.4 – Global Purchase Data – Information Source – Suppliers
According to the quantitative information collected from the various suppliers and presented in sections 2.1 to 2.3, the summary table of GCM supplies provided to company A... LDA. during the period under analysis results as follows.
(...)
2.6.4 – SUMMARY PURCHASE TABLE:
Below is presented a summary table of purchases according to the two information sources used and the determination of the respective difference.
Based on the values determined, it is concluded that the records made by the company are compliant, with differences being irrelevant in the universe analyzed.
(...)
3 – DETERMINATION OF GCM SALES/SUPPLIES
Based on the quantities acquired of GCM from the various suppliers and using the formula Sales determined = Opening + Purchases – Closing, it is intended to calculate the quantitative value of sales/supplies, based on the indicators mentioned, so as to immediately have a global view of the activity of each PAC, specifically regarding the commercialization of colored and marked diesel oil.
It should be noted that opening stock of the following year equals closing stock of the previous year (Opening 2015 = Closing 2014).
Although inventories were requested for 31/12/2014, 31/12/2015, 31/12/2016 and 31/12/2017, only those for 31/12/2015 and 31/12/2017 were sent by the PAC's accountant.
After several telephone contacts with Mr. B..., employee of the accounting firm D..., Lda., of which the PAC's accountant Mr. C... is manager, with a view to sending the missing inventories, these were not made available.
Procedures were then undertaken with the Finance Department of ... to request that it provide the inventory for 31/12/2014 and 31/12/2016, should the inventories have been reported to the AT. These items were sent by email on 13-06-2018.
We begin by presenting the existing stocks reported for each period by the PAC (inventory);
Summary tables of sales determined, applying the formula, and considering invoice No. 4,761 of 21-12-2016, referred to in section 2.6.4 – SUMMARY PURCHASE TABLE, as having been recorded in year 2016:
The values determined, in which in the "DIF" column positive values appear, mean that determined sales exceed sales recorded in the SAFT file.
4 – ANALYSIS OF DOCUMENTATION – GCM SALES/SUPPLIES
Commercial activity of GCM sales/supply may occur in four distinct ways, namely:
– sales to customers on immediate payment, whereby an invoice/receipt or simplified invoice is immediately issued;
– sales to customers on credit.
The analysis of the sales aspect was conducted based on SAFT, since according to email No. 2018..., of 27/02/2018, sent by the PAC's accountant, there are no maps of daily/monthly records, nor stock management extract of GCM.
a) SAFT Sales Files;
At the time of initial inspection, the SAFT/invoicing files of the station were requested.
4.1 – MONTHLY SAFT SALES FILE
According to the sales files SAFT for the period under analysis, the quantities sold are those presented by year/month:
4.2 – SALES BY CUSTOMER AND BY YEAR – SAFT SOURCE
Based on the same information source, information on sales by taxpayer number was extracted, the results of which are presented in the following table:
5 – QUANTITIES SOLD/SUPPLIED TO BE CONSIDERED
According to the results presented and taking into account what has been explained above, we will consider the quantities obtained from the SAFT files for purposes of general analysis and particular analysis (depending on the customer).
Thus, in summary, the quantities sold to be considered by year are as follows:
6 – ANALYSIS OF DOCUMENTATION – RECORDS IN TPA/POS
Given the specificity of the norms regulating GCM commercialization, a detailed analysis will be made for the period under analysis, regarding the records made in the TPA/POS (point of sale) terminals, to assess compliance with the legal norms governing this matter, namely the provisions in No. 5 and No. 6 of Ordinance No. 361-A/2008, of 12 May, which provides as follows:
No. 5 – "Colored and marked diesel oil may only be sold at fuel supply stations to beneficiaries of an exemption or reduction of ISP rate who are holders of microchip cards issued for this purpose by DGADR, through which all transactions of colored and marked diesel oil are recorded in the computer system managed by the Interbank Services Company (SIBS)".
No. 6 – Sales referred to in the previous number are obligatorily recorded in POS terminals at the moment they occur.
Company A... LDA., which operates the PAC under analysis, has/had the following TPAs assigned with GCM recording movements:
TPA 295655 – with 2,358 movements between 01-01-2015 to 31-12-2017;
TPA 893984 – with only 1 movement between 01-01-2015 to 31-12-2017.
The company, at the moment the action began, reported that it had indeed used TPA No. 893984 only once, using only TPA No. 295655. According to the consultation made on 12-06-2018, it is verified that the date of the last operation with TPA No. 893984 was in 2016, as shown in the print demonstration:
(...)
6.1. – RECORDS MADE IN TPA 295655 AND 893984
Below are presented the records existing in the period from 01-01-2015 to 31-12-2017, as they appear in the DGADR database and in a second summarized approach by years and months, as well as a global map of supplies by customer and period.
(...)
Based on the complete file of TPA records, the aggregated table with global information of records made in TPAs No. 295655 and 893984, for the years 2015, 2016 and 2017, results as follows.
RECORDS (LITERS) IN TPA 295655 AND 893984, BY MONTH IN THE PERIOD FROM 01-01-2015 TO 31-12-2017
6.2. – RECORDS MADE IN TPA 295655 AND 893984 BY YEAR AND BY CUSTOMER
Now, based on the same information source, the summary map of TPA records by year and by cardholder is presented:
RECORDS IN TPA 295655 AND 893984, BY CUSTOMER AND BY YEAR
(...)
7 – ASSESSMENT OF COMPLIANCE WITH GCM COMMERCIALIZATION RULES
To assess compliance with GCM commercialization rules, we will, at this stage, perform the analysis and confrontation of information collected from:
– the quantities sold, according to the values indicated in section 4 of this report;
– the records in the TPA, based on DGADR data, according to the quantities determined in section 6;
7.1 – DIRECT COMPARISON BETWEEN THE TWO INFORMATION SOURCES
The first assessment is made from the direct comparison between determined sales, addressed in section 3 of this report, to be considered and the TPA records, for each year:
Obs.: Negative values in the "difference" column mean the quantity of GCM sold/supplied that was not recorded in the TPA.
Where the difference reflects positive values, it means the quantity of GCM recorded exceeds the quantities sold.
Based on the analysis of results, it is immediately concluded that the practice used is not consistent with the commercialization rules provided for in Ordinance No. 361-A/2008, of 12 May, as well as constitutes a taxable event of Tax on Petroleum and Energy Products (ISP), pursuant to the provisions in No. 5 of article 93 of the CIEC;
To better understand the differences found, in the following sections a more exhaustive analysis will be conducted taking into account sales and records by customer.
7.2 – DIRECT COMPARISON BY CUSTOMER
At this stage, the objective is the comparison between sales by customer, according to SAFT files and records in the TPA, recorded in the respective cards of each of the customers, for each year and by PAC.
(...)
Based on what has been set out, an exhaustive analysis was made of all identified customers, for each year and by PAC, where various particular situations were identified that may constitute non-compliance with the norms regarding GCM commercialization.
For particular treatment, only the situations deemed relevant are presented, for the intended analysis of the result of comparison between the two information sources, using as reference criterion for the search the taxpayer number of the purchaser and the holders of GCM access cards.
However, due to the prevalence of invoicing in "Final Consumer" this is the first analysis we present.
7.2.1 ASSESSMENT OF COMPLIANCE WITH POINT 8 OF ORDINANCE NO. 361-A/2008, 12 MAY AND NO. 5 OF ARTICLE 93 OF THE CIEC
Final Consumer
In the period relating to the years 2015, 2016 and 2017, from the analysis of SAFT files, it was found that, in GCM sales, the operator A... LDA., with Tax ID ..., does not issue, in a generalized manner, nominative sales documents, that is, with indication of the purchaser's name, using recurrently the designation "Final Consumer" and without indication of the card holder's tax number.
Point 8 of Ordinance No. 361-A/2008, of 12 May, expressly states: "The registration in the computer system, through POS terminals, of each supply effected, does not dispense with the issuance of the respective invoice or equivalent document, issued in the name of the holder of the respective microchip card."
The legally provided requirement is not being complied with.
From 01-01-2015 onwards, due to the normative amendment of No. 5 of article 93 of the CIEC, approved by Law No. 82-B/2014, of 31 December (State Budget Law for 2015), fiscal responsibility has come to exist for owners or legal persons responsible for fuel supply stations, with payment of ISP (difference between ISP applied to road diesel and that applied to agricultural diesel), when the invoice is not issued in the name of the card holder.
A collection was made of sales to "Final Consumer" in the years 2015, 2016 and 2017, between 1 January and 31 December, respectively, determining that 90,626.32 liters were sold in year 2015, 90,418.47 liters in 2016 and 74,987.26 in 2017, as shown in the tables presented:
7.2.2 – INVOICING ISSUED WITHOUT CORRESPONDING RECORD IN TPA
In the period under analysis, in the specific situation of this subsection, invoices to "Final Consumer" are not presented.
With such invoicing exceeding TPA records, in the situations demonstrated below, it is important to detail these and which customers are involved.
In the analysis, for the period of this action, 2 situations were identified: SALES TO CUSTOMERS NOT HOLDING ACTIVE CARD:
In the table below, identified with (*) is 1 taxpayer, in which sales documents were issued to the customer identified in the table, with respective records made on a card held by their spouse.
In this spouse situation, although the legal norms governing this matter are not entirely conclusive, the records have been accepted and recognized as validly made.
The situations that fall under this point occur in 2016 and 2017 and in a total of 100.00 Lt. quantity recorded on the spouse's card (quantities not counted for taxation).
Below is presented for the aforementioned customer the information with respect to invoicing, the cardholder and respective records in the TPA/POS:
SALES TO CUSTOMERS HOLDING ACTIVE CARD WITHOUT RECORDS IN TPA
Given the first table of this subsection, the situations presented fall into one of the following, as described:
Sales made to non-cardholders, without any record being detected in the TPA of the respective PAC;
Sales made to non-cardholders, but which were subject to recording on third parties' cards. Recording made on a third party's card is not accepted as valid, so the record will be treated as "improper."
The situations described have legal basis in No. 5 of Ordinance No. 361-A/2008, of 12 May, which provides:
"5 – Colored and marked diesel oil may only be sold at fuel supply stations to beneficiaries of an exemption or reduction of ISP rate who are holders of microchip cards issued for this purpose by DGADR, through which all transactions of colored and marked diesel oil are recorded in the computer system managed by the Interbank Services Company (SIBS)"
8 – GLOBALIZATION OF TAXABLE QUANTITIES
Through the analysis developed throughout this report and presented in section 7.3, situations were identified that constitute a taxable event for ISP payment, due to non-compliance with the provision in No. 5 of article 93 of the CIEC, whereby we present below a summary table of taxable quantities, by year:
The situations mentioned as "Sales to Final Consumer," "Sales to non-Active Card Holders" and "Sales Not Recorded in TPA" are subject to taxation under ISP, due to non-compliance with the provision in No. 5 of article 93 of the CIEC, whereby we present below a summary table of taxable quantities, by year, according to the rates in effect:
VI. DEMONSTRATION OF AMOUNTS (DEBT) DETERMINED
The amounts determined are as follows:
From the global analysis of the various aspects developed in chapters IV and V of this report, they constitute violation of No. 5 of article 93 of the CIEC, with ISP being required from the person responsible for PAC operation – A... LDA., pursuant to that norm, concerning quantities sold and not properly recorded in the TPA.
Diesel oils are classified by the Combined Nomenclature code (CN), being up to 31-12-2011 the code 2710194500, currently being the code 2710194800.
The Combined Nomenclature "...is the tariff and statistical nomenclature of the customs union – the Common Customs Tariff is the external tariff applied to products imported into the European Union. The Integrated EU Tariff, called TARIC, contains the trade measures and EU measures applicable to goods imported and exported by the EU..."
Considering that the taxable unit of petroleum and energy products is 1,000 liters, according to the provision in No. 1 of article 91 of the CIEC.
The ISP rates, pursuant to articles 8, No. 2, 9, No. 3, 92, No. 1 and 93, No. 1 of the CIEC, applicable to road diesel oils are defined annually by the State Budget Law. In the case of GCM, they are defined by Ordinance of the Ministry of Finance.
Considering that the entry into force of Law No. 55/2007, of 31 August, entails the incidence of the Road Service Contribution (CSR) on gasoline and road diesel oils subject to ISP and are assessed simultaneously with the tax assessment, with a view to financing the national road network.
Considering that the ISP rate from the year 2008 remained unchanged until 11-02-2016 at 278.41 €/1,000 liters.
Alterations in ISP rates for 2016 having been verified as follows:
– up to 11-02 – the 2015 rate was in effect;
– between 12-02-2016 to 11-05-2016 – rates approved by Ordinance No. 24-A/2016, of 11-02;
– between 12-05-2016 to 16-11-2016 – rates approved by Ordinance No. 136-A/2016, of 12-05;
– from 17-11-2016 onwards – rates approved by Ordinance No. 291-A/2016, of 16-11;
Considering that CSR, pursuant to article 4 of Law No. 55/2007, was 87.98 €/1,000 liters, with the amendment made by Law No. 64-B/2011 (State Budget for 2012).
For the year 2013, CSR became 89.12 €/1,000 liters, with Law No. 66-B/2012 (State Budget for 2013) and in 2014, became 91.00 €/1,000 liters, with Law 83-C/2013 (State Budget for 2014).
For the year 2015, CSR became 111.00 €/1,000 liters, with Law No. 82-B/2014 (State Budget for 2015).
The ISP due results from the difference between the tax level applicable to road diesel oil and the rate applied to colored and marked diesel oil.
The tax debt under ISP, calculated pursuant to the CIEC, is as follows for each year under analysis:
YEAR 2015
Sales without compliance with the provision in No. 5 of article 93 of the CIEC in a total of 93,131.35 liters, constituting a taxable event for ISP debt, calculated as follows:
YEAR 2016
In this year, given the different rates to be applied, a table is presented with the quantities to be taxed divided by the corresponding periods:
YEAR 2016 (until 11 February) – Sales without compliance with the provision in No. 5 of article 93 of the CIEC in a total of 16,844.50 liters, constituting a taxable event for ISP debt, calculated as follows:
YEAR 2016 (between 12 February and 11 May) – Sales without compliance with the provision in No. 5 of article 93 of the CIEC in a total of 23,693.15 liters, constituting a taxable event for ISP debt, calculated as follows:
YEAR 2016 (between 12 May and 16 November) – Sales without compliance with the provision in No. 5 of article 93 of the CIEC in a total of 34,703.79 liters, constituting a taxable event for ISP debt, calculated as follows:
YEAR 2016 (between 17 November and 31 December) – Sales without compliance with the provision in No. 5 of article 93 of the CIEC in a total of 19,380.61 liters, constituting a taxable event for ISP debt, calculated as follows:
YEAR 2017
Sales without compliance with the provision in No. 5 of article 93 of the CIEC in a total of 77,978.9 liters, constituting a taxable event for ISP debt, calculated as follows:
From the sum of the tax debt values under ISP calculated, the summary table of determined debt results, by differences determined between sales effected and sales recorded corrected in POS/TPA:
In global terms, the amount of tax debt under ISP amounts to 86,819.94 €.
(...)
IX.2 – Exercise of Right to Hearing
On 04/07/2018, a document was received at this Customs Authority, with entry No. 2018... (GPS), exercising the right to hearing, requesting payment of the fine with reduction provided under articles 29 and 30 of the RGIT.
In the document presented for exercise of the right to hearing, the taxpayer alleges, essentially, that regarding:
Issuance of invoice for sale of GCM without customer identification
-
The manager's concern was always to sell GCM only to holders of the microchip card, knowing that this gave a benefit and, as such, GCM sales could only be made to a valid cardholder. However, and due to lack of knowledge, as he had never been alerted, not even by his suppliers, he did not issue the invoice with customer identification, believing, and since he had already made the respective record in the TPA at the time of using the microchip card, that the obligation to identify the consumer only arose if the sale was in an amount exceeding one thousand euros, as provided in No. 15 of article 36 of the VAT Code (Code of Value Added Tax). And "he thought that this practice of issuing invoices without consumer identification was legal and brought no prejudice to the State, as it brought no benefit to me or my company."
-
The taxpayer argues that the procedure of issuing GCM sale invoices without customer identification, although legally irregular, brought no prejudice to the State, since the invoice was issued to the final consumer, "the taxes that were due were paid, being no different if those invoices had actually shown the name of the cardholder, since such sales were made to the valid cardholder."
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The taxpayer further declares that "assuming responsibility for the difference in tax values imposed on fuel ... only because of invoicing without name, despite having sold it to who legitimately could acquire it and having effectively invoiced it, is something extremely violent, unjust, a sanction completely out of proportion, disproportionate in a rule of law, applied to someone who, out of mere lack of adequate information, did not comply with a mere formal requirement in invoice completion."
-
He concludes, stating there was no deviation from the purpose of this fuel, and that the State possesses information on consumer identification through the use of the microchip card issued by DGADR, bringing no prejudice to the State, thus requesting the filing of these proceedings, under penalty of leading to the bankruptcy of an inland company, "with its partners/family members, at the end of a lifetime of work, in poor health and with no economic conditions for survival."
IX.3. Analysis of Elements Presented in the Right to Hearing
The allegations set out in the right to hearing merit the following considerations:
Issuance of GCM sale invoice without customer identification
According to Ordinance No. 361-A/2008, No. 6 and 8 and with the wording given by Law No. 82-B/2014, of 31 December, which approved the State Budget for 2015 to No. 5 of article 93 of the Code of Excise Duties on Consumption, at the moment GCM sale occurs, the supply must be simultaneously recorded on the beneficiary's card through the POS/TPA of the PAC, and the respective sales document issued in the name of that beneficiary.
Let us examine this legislation:
CODE OF EXCISE DUTIES ON CONSUMPTION (CIEC)
Article 93 – Reduced Rates
"5. Colored and marked diesel oil may only be acquired by holders of the electronic card established for the purposes of monitoring its allocation to the destinations referred to in No. 3, with the owner or legal person responsible for the operation of fuel stations authorized for public sale being responsible for payment of the amount of tax resulting from the difference between the tax level applicable to road diesel oil and the rate applicable to colored and marked diesel oil, in relation to quantities sold and not properly recorded in the electronic control system, as well as in relation to quantities for which the corresponding invoices are not issued in the name of the cardholder."
Ordinance No. 361-A/2008
"6. Sales referred to in the previous number are obligatorily recorded in POS terminals at the moment they occur.
- Registration in the computer system, through POS terminals, of each supply effected, does not dispense with the issuance of the respective invoice or equivalent document, issued in the name of the holder of the respective microchip card."
The NAME and TAX ID NUMBER are elements that, according to the VAT Code – article 36, No. 5, letter a), are fiscally relevant:
VAT CODE – Code of Value Added Tax
Article 36
Deadline for Issuance and Formalities of Invoices
"5 – Invoices must be dated, numbered sequentially and contain the following elements: (As amended by D.L. No. 197/2012, of 24 August, effective 1 January 2013)
a) The names, trade names or corporate designations and the business address or domicile of the supplier of goods or provider of services and the recipient or purchaser, as well as the corresponding tax identification numbers of the taxpayers subject to the tax;"
Considering that, from 01-01-2015 onwards, due to the normative amendment of No. 5 of article 93 of the CIEC, approved by Law No. 82-B/2014, of 31 December (State Budget Law for 2015), fiscal responsibility has come to exist for owners or legal persons responsible for fuel supply stations, with payment of ISP (difference between ISP applied to road diesel and that applied to agricultural diesel), when the invoice is not issued in the name of the cardholder and that the legally provided requirement is not being complied with, continuing to verify all the grounds that formed the basis of the tax determination, the determined values shall be maintained in the proposed conclusions, for the years 2015, 2016 and 2017.
IX.4. Conclusion
Given what was alleged by the taxpayer, and continuing to verify all the factual and legal prerequisites that formed the basis of the tax determination, resulting from various situations that constitute non-compliance with normative rules, as summarized in point 1 A1), A2) and A3) of this report, we consider that no evidence was submitted to the proceedings that refutes what was communicated in the prior hearing, whereby this final report is prepared.
The taxpayer requested payment of the fine with reduction provided under articles 29 and 30 of the RGIT.
C) Following the inspection, the Tax and Customs Authority issued Assessment No. ..., dated 01-08-2018, in the amount of € 92,716.83, whose content is reproduced herein;
D) On 21-08-2018, the Claimant paid the assessed amount (document No. 2 attached with the request for arbitral pronouncement, whose content is reproduced herein);
E) The Claimant's customers issued the declarations contained in documents Nos. 4, 5 and 6 attached with the request for arbitral pronouncement, whose contents are reproduced herein;
F) The Claimant issued the invoices contained in documents 7, 8 and 9 attached with the request for arbitral pronouncement, whose contents are reproduced herein;
G) On 19-09-2018, the Claimant presented the request for constitution of the arbitral tribunal that gave rise to this case.
2.2. Unproven Facts and Reasoning of the Decision on the Facts
It was not proven that all sales of colored and marked diesel oil made by the Claimant were to purchasers who were holders of microchip cards, particularly in the cases underlying the assessment.
The facts were established as proven based on the Tax Inspection Report and the documents submitted by the Claimant.
3. Statement of Law
In the arbitral judgment of 26-01-2019, matters of law were examined as follows.
Tax on Petroleum and Energy Products (ISP) is imposed on diesel oil, pursuant to articles 1, letter b), 5 and 88, No. 1, letter a), of the CIEC (Code of Excise Duties on Consumption, approved by Decree-Law No. 73/2010, of 31 June).
Colored and marked diesel oil (hereinafter "GCM"), intended for the purposes provided in article 93, No. 3, of the CIEC, benefits from a special reduced rate, compared to the rate provided in article 92.
The Claimant operates a fuel supply station where, among other things, it commercializes GCM.
Pursuant to No. 5 of the same article 93, acquisition of GCM is subject to the use of "electronic card established for the purposes of monitoring its allocation to the destinations referred to in No. 3."
GCM may only be supplied or sold to holders of properly licensed fuel supply stations who hold point of sale (POS) terminals, pursuant to No. 3 of Ordinance No. 361-A/2008, of 12 May (also referred to as TPA, abbreviation for Automatic Payment Terminal, or TPA/POS).
The Tax and Customs Authority conducted an inspection of the Claimant and understood that there were irregularities in commercialization, classifiable under article 93, No. 5, of the CIEC, and non-compliance with Nos. 5, 6 and 8 of Ordinance No. 361-A/2008, of 12 May, specifically:
a) Sales of GCM without issuance of a nominative invoice to the cardholder using the designation "final consumer," without identification of the cardholder;
b) Sales of GCM that were not recorded in the POS/TPA with the microchip card of the holder;
c) Sales of GCM to customers who were not holders of an active microchip card;
d) Sales of GCM exceeding those recorded in the SAFT file.
Article 93, No. 5 of the CIEC, in the wording in effect during the years 2015, 2016 and 2017 (introduced by Law No. 82-B/2014, of 31 December) establishes the following:
Article 93
Reduced Rates
5 – Colored and marked diesel oil may only be acquired by holders of the electronic card established for the purposes of monitoring its allocation to the destinations referred to in No. 3, with the owner or legal person responsible for the operation of fuel stations authorized for public sale being responsible for payment of the amount of tax resulting from the difference between the tax level applicable to road diesel oil and the rate applicable to colored and marked diesel oil, in relation to quantities sold and not properly recorded in the electronic control system, as well as in relation to quantities for which the corresponding invoices are not issued in the name of the cardholder.
Nos. 5 and 8 of Ordinance No. 361-A/2008, of 12 May, establish the following:
5. Colored and marked diesel oil may only be sold at fuel supply stations to beneficiaries of an exemption or reduction of ISP rate who are holders of microchip cards issued for this purpose by DGADR, through which all transactions of colored and marked diesel oil are recorded in the computer system managed by the Interbank Services Company (SIBS).
6. Sales referred to in the previous number are obligatorily recorded in POS terminals at the moment they occur.
(...)
8. Registration in the computer system, through POS terminals, of each supply effected, does not dispense with the issuance of the respective invoice or equivalent document, issued in the name of the holder of the respective microchip card.
3.1. Issue of Sales of GCM to Customers Who Were Not Holders of an Active Microchip Card
The Claimant argues that No. 3 of article 12 of the CIEC, which waives payment when amounts are below 25 euros, until 31/03/2016, and 10 euros from this date, and presents lists of transactions it believes are covered by that provision.
The aforementioned No. 3 of article 12 states that "there is no taxation when the amount assessed is less than € 10" (€ 25 under the wording introduced by Law No. 7-A/2016, of 30 March).
This is a technical exemption, justified by the onerous collection costs that would presumptively exceed the revenue to be collected.
Consequently, this rule only applies when such an amount has been assessed, which was not the case, and there is a need to collect it separately.
In the present case, with the assessed and collected amount being much higher than that value, this technical exemption does not apply.
Accordingly, the request for arbitral pronouncement is unfounded on this issue.
3.2. Issue of Invoice Issuance in a Different Year from the "Discharge" on the Card
The Claimant argues that, concerning the 1,070.57 liters of GCM referred to on pages 13 and 78 of the Tax Inspection Report, corresponding to the alleged difference between the quantity supplied and not recorded in the TPA in 2017, there are inverse differences noted in the years 2015 and 2016.
The Claimant criticizes the Tax and Customs Authority for saying nothing about the differences for the years 2015 and 2016 and not "drawing the consequence of such fluctuations that materialize in a 'multi-year compensation effect.'"
The Claimant also states "that the AT did not conduct a complete analysis of the matter as was incumbent on it and whose result would differ from what it reached, the assessment at this point is not justified and as such should be annulled" and "the invoicing rules are (and properly) inscribed in the diplomas relating to VAT (numbers 1 to 3 of article 36 of the VAT Code) and nothing in the CIEC (e.g., No. 5 of article 93) provides for the deadline within which invoices must be issued."
It appears that the Claimant is correct concerning the defect of justification of the Tax Inspection Report on this point.
In fact, electronic recording in the system must be made at the moment they occur (No. 6 of Ordinance No. 361-A/2008), but no special regime is provided for invoice issuance, whereby they may be issued within the deadline provided in letter a) of No. 1 of article 36 of the VAT Code.
Thus, the justification of the decision of the Tax and Customs Authority is not clear when it considered, without any other explanation, that there was a difference of 1,070.57 liters of GCM in 2017 between the quantities supplied and those recorded in the system.
For the reasons stated, the defect of lack of justification invoked by the Claimant is valid on this point.
3.3. Sales of GCM That Were Not Recorded in POS/TPA with the Microchip Card of the Holder
The Claimant presents as justification for the lack of recording with the microchip card of sales of GCM the existence of "relations of friendship and neighborliness, since only thus is explained that farmers who have electronic cards were supplied with agricultural diesel without their respective electronic card being 'discharged.'"
The requirement for recording acquisitions on the microchip card is justified by reasons of preventing tax evasion and facilitating control by the Tax and Customs Authority of the allocation of GCM to the destinations referred to in No. 3.
No. 6 of Ordinance No. 361-A/2008 leaves no doubt as to the need for GCM sales to be "obligatorily recorded in POS terminals at the moment they occur."
In the same vein, article 93, No. 5, of the CIEC establishes the responsibility of the "owner or legal person responsible for the operation of fuel stations authorized for public sale, in relation to quantities sold and not properly recorded in the electronic control system."
There is, thus, under these norms, no possibility of making up for the lack of recording in the electronic system through declarations from some possible purchasers. ( )
Accordingly, the request for arbitral pronouncement is unfounded on this issue.
3.4. Sales of GCM Without Issuance of a Nominative Invoice to the Cardholder Using the Designation "Final Consumer," Without Customer Identification
The Tax and Customs Authority found that sales were made with invoices showing the indication of "final consumer" in the years 2015, 2016 and 2017: 90,626.32 liters in year 2015, 90,418.47 liters in 2016 and 74,987.26 in 2017.
No. 8 of Ordinance No. 361-A/2008 states that it is not dispensed with the issuance of "invoice or equivalent document, issued in the name of the holder of the respective microchip card."
The Claimant states that this would be an "oversight of the CLAIMANT, if one exists, resulting from the fact that for VAT purposes, which is the seat of legislation on invoicing, only from 1,000 euros onwards is it necessary to identify the customer fiscally."
The Claimant argues that the Tax and Customs Authority, with "certainly meticulous work – would certify the correspondence of each of those invoices to the records made in TPAs 295,655 and 893,984 (see pp. 17 et seq. of the Final Report) where it stands out for each one, the day and hour, the card number; the beneficiary number and the number of liters and the MU, with no room for any doubt as to the legality of the procedure."
That invoicing obligation, despite the electronic recording in the TAP/POS, has existed since 2008, when Ordinance No. 361-A/2008 was issued, and not from the State Budget for 2015, contrary to what the Claimant states. With this Budget, through the new wording given to No. 5 of article 93, responsibility for these situations of non-issuance of invoices was merely extended to the owner or legal person responsible for the operation of the station.
Furthermore, those special obligations imposed in the commercialization of GCM are intended to enable the Tax and Customs Authority to effectively control the use of the benefit without need for the "certainly meticulous work" that the Claimant acknowledges would be necessary to determine the correspondence of each of the invoices to the computer records.
As the Tax and Customs Authority states, the "task of matching/correspondence a posteriori is an endless, if not impossible, task," as evidenced by the fact that the Claimant, which had an interest in performing this correspondence between the records made in the TPA and the invoices in this proceeding, limited itself to providing some examples.
Aiming for that invoicing obligation with identification of purchasers to facilitate control of the correct use of the benefit, through the intersection of information in the possession of the seller and purchaser, enabling detection of fraud and tax evasion, this obligation cannot be considered a useless or disproportionate formality, particularly because it is manifest the ease of its compliance by the seller. For this reason, the requirement of this formality and its consequences for omission cannot be considered incompatible with the constitutional principle of proportionality.
Furthermore, this formality of invoicing with identification of the purchaser has precisely the purpose of the same tax evasion prevention pursued with the requirement of recording in the purchaser's card acquisition, whereby it cannot be considered unjustified that the omission of this formality has the same consequence as the lack of recording in the card.
As the Tax and Customs Authority properly states, "even if there was exact coincidence of all data – quantities, values, day and hour – of the invoice with those of the card record in the TPA, such coincidence is not a sufficient and adequate means of proof that the sale was effectively made to the holder of that card, since experience shows that sale to one person may occur through abusive use of another's card." It is the verification that the purchaser was the holder of the card that is intended to be reinforced with the requirement of identification of the purchaser in the invoice.
With the cumulative requirement being a reinforcement of the possibilities of control by the Tax and Customs Authority, facilitating its inspection that, without this formality, would be "certainly meticulous work" (as the Claimant recognizes), and with it being a formality whose compliance does not appear appreciably more onerous than the electronic recording of the transaction, the imposition of the same consequence for omission of this formality cannot be considered inappropriate, which is the liability of the owner or legal person responsible for the operation of the station. The abusive use of third parties' cards in recordings in the control system, being able to be traced back to acquisition of GCM with benefit by someone not entitled to it, is not a situation of tax evasion substantially different from acquisition by someone who is not even a holder of a microchip card.
Accordingly, No. 5 of article 93 of the CIEC does not offend the constitutional principles of proportionality and equality invoked by the Claimant.
Thus, with this formality being provided for in law and with responsibility of the owners or legal persons responsible for the stations being expressly provided "in relation to quantities for which the corresponding invoices are not issued in the name of the cardholder" (final part of No. 5 of article 93 of the CIEC), it cannot but be recognized that the Tax and Customs Authority was correct in assessing based on the non-issuance of "invoices in the name of the cardholder."
For this reason, with arbitral tribunals having to decide in accordance with the constituted law, with recourse to equity being barred (article 2, No. 2, of the RJAT), and with No. 5 of article 93 of the CIEC not being subject to unconstitutionality, there is no alternative to recognizing that the application of that rule by the Tax and Customs Authority was correct.
Accordingly, the request for arbitral pronouncement is unfounded on this issue.
4. Reform of the Arbitral Decision
The issue on which appeal was lodged was that examined in section 3.4 of the arbitral decision ("Sales of GCM without issuance of a nominative invoice to the cardholder using the designation 'final consumer,' without customer identification").
Thus, with the grounds of the aforementioned judgment of the Constitutional Court, which is reproduced herein, it is to be considered unconstitutional No. 5 of article 93 of the Code of Excise Duties on Consumption (CIEC), in the segment in which it determines as responsible for payment of the amount of tax resulting from the difference between the tax level applicable to road diesel oil and the rate applicable to colored and marked diesel oil, the owner or legal person responsible for the operation of fuel stations authorized for public sale, in relation to quantities sold to holders of electronic cards for which the corresponding invoices are not issued in the name of the cardholder.
Consequently, the challenged assessment is subject to the defect of violation of law, due to error in the legal prerequisites, in the respective part, which justifies its annulment, in the part on which it is based in that segment, pursuant to article 163, No. 1, of the Administrative Procedure Code, subsidiarily applicable under article 2, letter c), of the General Tax Law.
The assessment of compensatory interest has as its prerequisite the assessment of Tax on Petroleum and Energy Products (ISP), Road Service Contribution (CSR), whereby it is subject to the same defect (in addition to the defect of lack of justification declared in section 3.2 of the arbitral decision).
5. Restitution of Amounts Paid
On 21-08-2018, the Claimant paid the assessed amount.
The request for arbitral pronouncement is well-founded as to the part of the assessment that has as its prerequisites the 1,070.57 liters of GCM referred to in section 3.2 of the arbitral decision (assessed value of € 366.03) and as to sales with invoices showing the indication of "final consumer" in the years 2015, 2016 and 2017: 90,626.32 liters in year 2015, 90,418.47 liters in 2016 and 74,987.26 in 2017 (assessed value of € 83,618.63) (in total € 83,984.66).
Given that compensatory interest was assessed in the amount of € 5,896.89 based on the value of € 86,819.94, to the amount of € 83,984.66 concerning which annulment of the assessment is justified, there correspond compensatory interest in the amount of € 5,704.32.
Thus, in total the Claimant is entitled to restitution of € 89,688.98 (being € 390.89 concerning the defect of lack of justification and € 89,298.09 concerning the defect of unconstitutionality).
6. Indemnificatory Interest
The substantive regime for the right to indemnificatory interest is regulated in article 43 of the General Tax Law, establishing, to the extent relevant here, the following:
Article 43
Undue Payment of the Tax Obligation
1 – Indemnificatory interest is due when it is determined, in administrative reconsideration or judicial challenge, that there was error attributable to the services resulting in payment of the tax debt in an amount greater than legally due.
(...)
3. Indemnificatory interest is also due in the following circumstances:
(...)
d) In the case of a final judicial decision declaring or judging the unconstitutionality or illegality of the legislative or regulatory norm on which the assessment of the tax obligation was based and determining its return.
As the Supreme Administrative Court has ruled, this article 43, No. 1, of the General Tax Law only provides for the right to indemnificatory interest when an error in the factual or legal prerequisites of the assessment is demonstrated, which does not occur when annulment is based on a defect of form, due to lack of justification. ( )
Thus, the Claimant is entitled to indemnificatory interest only under letter d) of No. 3 of article 43 of the General Tax Law, as to the part of annulment concerning the defect of unconstitutionality, in the amount of € 89,298.09.
Indemnificatory interest must be calculated based on the amount of € 89,298.09 and counted from 21-08-2018, the date on which the Claimant made payment of this amount, until its reimbursement, at the legal default rate, pursuant to articles 43, No. 4, and 35, No. 10, of the General Tax Law, article 61 of the Code of Tax Procedure and Administrative Proceedings, article 559 of the Civil Code and Ordinance No. 291/2003, of 8 April.
7. Decision
For these reasons, it is decided:
a) To partially uphold the request for arbitral pronouncement;
b) To partially annul Assessment No. ..., in the amount of € 89,688.98;
c) To order the Tax and Customs Authority to reimburse the Claimant in the amount of € 89,688.98;
d) To partially uphold the request for indemnificatory interest and to order the Tax and Customs Authority to pay it to the Claimant under the terms referred to in section 4 of this judgment.
e) To absolve the Tax and Customs Authority from the remaining requests.
8. Value of the Case
In accordance with article 305, No. 2, of the Code of Civil Procedure and 97-A, No. 1, letter a), of the Code of Tax Procedure and Administrative Proceedings and 3, No. 2, of the Regulation of Fees in Tax Arbitration Proceedings, the case value is fixed at € 92,716.83.
9. Fees
Pursuant to article 22, No. 4, of the RJAT, the amount of fees is fixed at € 2,754.00, pursuant to Table I attached to the Regulation of Fees in Tax Arbitration Proceedings, chargeable to the Claimant in the percentage of 3.27% and chargeable to the Tax and Customs Authority in the percentage of 96.73%.
Lisbon, 31-08-2020
The Arbitrators
(Jorge Lopes de Sousa)
(Fernando Araújo)
(António Alberto Franco)
ARBITRAL DECISION
The arbitrators Adv. Jorge Lopes de Sousa (arbitrator-president), Prof. Doctor Fernando Borges de Araújo and Dr. António Alberto Franco (arbitrators members), appointed by the Deontological Council of the Administrative Arbitration Center to form the Arbitral Tribunal, constituted on 28-11-2018, hereby agree as follows:
1. Report
A... LDA, legal entity no. ..., with headquarters in ..., ...-... ... (hereinafter referred to as "Claimant"), came forth, pursuant to Decree-Law No. 10/2011, of 20 January (hereinafter "RJAT"), requesting the constitution of an Arbitral Tribunal.
The Claimant seeks the annulment of Assessment No. ..., dated 01-08-2018, in the total amount of € 92,716.83, relating to Tax on Petroleum and Energy Products (ISP), Road Service Contribution (CSR) and Compensatory Interest (JC) arising from the Inspection identified by Case OI2018....
The Claimant further requests reimbursement of the aforementioned amount, plus indemnificatory interest.
The Respondent is the TAX AND CUSTOMS AUTHORITY.
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 19-09-2018.
Pursuant to letter a) of No. 2 of article 6 and letter b) of No. 1 of article 11 of the RJAT, in the wording introduced by article 228 of Law No. 66-B/2012, of 31 December, the arbitrators initially appointed by the Deontological Council communicated their acceptance of the appointment within the applicable deadline.
On 08-11-2018, the parties were duly notified of this appointment, and neither manifested a will to refuse the appointment of the arbitrators, pursuant to articles 11, No. 1, letters a) and b) of the RJAT and articles 6 and 7 of the Deontological Code.
Thus, in accordance with the provision in letter c) of No. 1 of article 11 of the RJAT, in the wording introduced by article 228 of Law No. 66-B/2012, of 31 December, the collective arbitral tribunal was constituted on 28-11-2018.
The Tax and Customs Authority submitted a Response in which it argued that the request for arbitral pronouncement should be judged unfounded.
By order of 07-01-2019, the meeting provided for in article 18 of the RJAT and arguments were waived.
On 24-01-2019, the Claimant came forth to attach a copy of the arbitral decision delivered in case No. 58/2018-T, "to which the claimant intended to rely in the arguments to be produced, since the factual and legal contours are identical."
The arbitral tribunal was regularly constituted, in accordance with the provisions in articles 2, No. 1, letter a), and 10, No. 1, of Decree-Law No. 10/2011, of 20 January, and is competent.
The parties are duly represented, enjoy personality and legal capacity, are legitimate, and are represented (articles 4 and 10, No. 2, of the same decree-law and article 1 of Ordinance No. 112-A/2011, of 22 March).
The case is free of defects of nullity.
2. Statement of Facts
2.1. Proven Facts
The following facts are considered proven:
H) A tax inspection was conducted by the Customs Authority of ... on the Claimant regarding the activity of acquisition and sale, in the years 2015, 2016 and 2017, of Colored and Marked Diesel Oil intended for agriculture, hereinafter designated "GCM";
I) In that inspection, the Tax Inspection Report was drawn up, which is contained in document No. 1 attached with the request for arbitral pronouncement, whose content is reproduced herein, wherein it is stated, among other things, the following:
A) CONCERNING THE FACTS ESTABLISHED
The operator operates this fuel supply station (PAC), located in ... – ...;
During this period, various situations were identified that constitute non-compliance with normative rules, which we will develop throughout this report;
A1) – SALES NOT PROPERLY RECORDED IN THE TPA
In order to aggregate all the information presented in the previous point, summary tables are presented for the year, concerning sales that were not properly recorded in the TPA, whose quantities are summarized as follows:
A2) – SALE TO NON-CARDHOLDER
During the period under analysis, the company sold agricultural diesel to customers who, as of the date of the supply, according to information obtained from the DGADR Database, were not holders of active microchip cards, as shown in the table in chapter V.
A3) – DETERMINATION OF TAX DEBT UNDER ISP – LEGAL BASIS
Considering Decree-Law No. 73/2010 of 21 June, which approves the new Code of Excise Duties on Consumption (CIEC).
Considering Decree-Law No. 73/2010 of 21 June, which approves the new Code of Excise Duties on Consumption (CIEC), repealing as of its entry into force on 21 July Decree-Law No. 566/99, of 22 December.
Considering that fuels in general and diesel oils in particular are subject to Tax on Petroleum and Energy Products (ISP), according to the provisions of article 5 and letter a) of No. 1 of article 88 of the CIEC.
Considering that, according to Nos. 1, 3 and 5 of article 93 of the CIEC, colored and marked diesel oils acquired by holders of the electronic card established for the purposes of monitoring allocation to authorized destinations are taxed at a reduced rate.
Considering that, according to the provision in No. 5 of article 93 and letter h) of No. 2 of article 4 of the CIEC, the owner or legal person responsible for the operation of authorized fuel stations for public sale of GCM is responsible for payment of the amount of tax resulting from the difference between the tax level applicable to road diesel oil and the level applicable to GCM, concerning quantities sold that are not properly recorded in the computer system associated with the assigned electronic cards.
Considering that, pursuant to No. 3 of article 11 of the CIEC, in the event of an irregularity that prejudices tax collection, the competent customs authority shall proceed to assess and notify the respective taxpayer.
Considering that the assessment is based on No. 5 of article 93 of the CIEC, combined with No. 5 of Ordinance No. 361-A/2008, of 12 May, that is, the tax to be assessed results from the difference between the tax level applicable to road diesel oil and the rate applicable to GCM, in relation to quantities sold and not properly recorded in the computer system underlying the assigned microchip cards.
Considering that in the years 2015, 2016 and 2017, quantities of GCM were identified as sold and not properly recorded in the cards of the purchasers.
Considering that quantities of GCM were identified as sold to non-card holders. Tax assessment should then be proceeded with concerning ISP due for sales of GCM effected during the indicated period, for which the corresponding records were not made in the POS/TPA:
Pursuant to No. 3 of article 11 of the CIEC, a subsequent assessment shall be recorded, whereby the competent tax assessment form (IL) should be processed in the total amount of 86,819.94 € (as shown in chapter VI), plus the respective compensatory interest, calculated pursuant to article 35 of the General Tax Law (LGT), approved by Decree-Law No. 398/98.
The taxpayer exercised the right to prior hearing, as related in section IX of this report.
On the ISP established, as well as on the sales value concerning quantities transacted in GCM that were not properly recorded in the electronic control system and which are identified in this report, VAT shall also be due, to be assessed by the Finance Department of....
With respect to the irregularities, these are described in chapter VII of this report.
According to the provision in letter h) of No. 2 of article 4 of the CIEC, the taxpayer is the economic operator A... LDA. – Tax ID Number...
(...)
2.4 – Global Purchase Data – Information Source – Suppliers
According to the quantitative information collected from the various suppliers and presented in sections 2.1 to 2.3, the summary table of GCM supplies provided to company A... LDA. during the period under analysis results as follows.
(...)
2.6.4 – SUMMARY PURCHASE TABLE:
Below is presented a summary table of purchases according to the two information sources used and the determination of the respective difference.
Based on the values determined, it is concluded that the records made by the company are compliant, with differences being irrelevant in the universe analyzed.
(...)
3 – DETERMINATION OF GCM SALES/SUPPLIES
Based on the quantities acquired of GCM from the various suppliers and using the formula Sales determined = Opening + Purchases – Closing, it is intended to calculate the quantitative value of sales/supplies, based on the indicators mentioned, so as to immediately have a global view of the activity of each PAC, specifically regarding the commercialization of colored and marked diesel oil.
It should be noted that opening stock of the following year equals closing stock of the previous year (Opening 2015 = Closing 2014).
Although inventories were requested for 31/12/2014, 31/12/2015, 31/12/2016 and 31/12/2017, only those for 31/12/2015 and 31/12/2017 were sent by the PAC's accountant.
After several telephone contacts with Mr. B..., employee of the accounting firm D..., Lda., of which the PAC's accountant Mr. C... is manager, with a view to sending the missing inventories, these were not made available.
Procedures were then undertaken with the Finance Department of ... to request that it provide the inventory for 31/12/2014 and 31/12/2016, should the inventories have been reported to the AT. These items were sent by email on 13-06-2018.
We begin by presenting the existing stocks reported for each period by the PAC (inventory);
Summary tables of sales determined, applying the formula, and considering invoice No. 4,761 of 21-12-2016, referred to in section 2.6
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