Summary
Full Decision
ARBITRAL AWARD
1. Report
A – General
1.1. A..., CLOSED REAL ESTATE INVESTMENT FUND, taxpayer number ..., managed and represented by B... – Real Estate Investment Fund Management Company, S.A., with registered office at ..., no. ...-..., ...-... Lisbon, with the unique identification number and registration in the commercial registry office... (hereinafter referred to as "Applicant"), filed on 29.07.2015 a request for constitution of a tax arbitral tribunal, which was accepted, seeking, on one hand, the declaration of illegality of three acts of assessment of Stamp Tax of 20.03.2015, relating to item 28.1 of the General Table of Stamp Tax (hereinafter "GTST"), concerning properties of which it is the owner, as will be better seen below, in the global amount of € 111,387.04 (one hundred eleven thousand three hundred eighty-seven euros and four cents), which gave rise to collection notices no. 2015..., no. 2015... and no. 2015..., in the global amount of € 37,129.02 (thirty-seven thousand one hundred twenty-nine euros and two cents), relating to the first installment, and, on the other hand, compensation for damages suffered by it as a result of undue payment of tax installments.
1.2. Pursuant to the provisions of subparagraph a) of paragraph 2 of Article 6th and subparagraph b) of paragraph 1 of Article 11th of Decree-Law no. 10/2011, of 20 January, as amended by Article 228th of Law no. 66-B/2012, of 31 December, the Ethics Council of the Administrative Arbitration Center (CAAD) designated as presiding arbitrator Ms. Counsellor Maria Fernanda Maçãs and as co-arbitrators Ms. Professor Doctor Nina Aguiar and Dr. Nuno Pombo, and the Parties, after being duly notified, did not object to such designation.
1.3. By order of 07.09.2015, the Tax and Customs Authority (hereinafter referred to as "Respondent") proceeded to designate Ms. Dr. C... and Ms. Dr. D... to intervene in the present arbitral proceedings, in the name and representation of the Respondent.
1.4. In accordance with the provision of subparagraph c) of paragraph 1 of Article 11th of Decree-Law no. 10/2011, of 20 January, as amended by Article 228th of Law no. 66-B/2012, of 31 December, the arbitral tribunal was constituted on 28.10.2015.
B – Position of the Applicant
1.5. On the date of 31.12.2014, the Applicant was the owner of three construction plots, to which correspond the property deeds annexed to the request as documents nos. 3 to 5, the contents of which are hereby reproduced (hereinafter briefly referred to as "Properties"), namely:
1.5.1. One situated in ..., parish of ..., municipality of Loulé, with an area of 28,290 m² (twenty-eight thousand two hundred ninety square meters) and tax patrimonial value (TPV), at that date, of € 5,080,766.67 (five million eighty thousand seven hundred sixty-six euros and sixty-seven cents), registered in the property matrix of that parish under article...;
1.5.2. Another also situated in ..., parish of ..., municipality of Loulé, with an area of 15,168 m² (fifteen thousand one hundred sixty-eight square meters) and TPV, at that date, of € 4,822,497.13 (four million eight hundred twenty-two thousand four hundred ninety-seven euros and thirteen cents), registered in the property matrix of that parish under article...; and, finally,
1.5.3. Another situated in the Place of ..., Union of parishes of ... and ..., municipality of Cascais, with an area of 31,015 m² (thirty-one thousand and fifteen square meters) and TPV, at that date, of € 1,235,440.00 (one million two hundred thirty-five thousand four hundred forty euros), registered in the property matrix of that parish under article....
1.6. The Applicant was notified of the Stamp Tax assessments (hereinafter referred to as "ST") referred to in 1.1., the collection documents relating to the first installment of which were annexed to the arbitration request as documents nos. 1 to 3, the contents of which are hereby reproduced, which were based on Article 1st of the Stamp Tax Code (hereinafter the "STC") and on item 28.1 of the GTST, amended by Article 4th of Law no. 55-A/2012, of 29 October.
1.7. On the Properties, on the date of 31.12.2014, nothing had been constructed or was under construction, and they did not result from any prior subdivision of parcels.
1.8. The Municipal Council of ... had not issued, by the date of submission of the arbitration request, any order or final resolution regarding the subdivision request for the properties mentioned in 1.7.1 and 1.7.2 pending under number .../... 2004..., nor had the Municipal Council of Cascais issued, by that same date, any order or final resolution regarding any request for urban development operation or any authorization for subdivision or construction relating to the property referred to in 1.7.3., from which would follow permission for any urban development operation to be carried out thereon.
1.9. The Applicant contends that the interpretation made by the Respondent of item 28.1 of the GTST, as amended by Article 194th of the State Budget Law for 2014, considering it applicable to the Properties, is unconstitutional, due to violation of the principles of democratic rule of law (in its aspects of protection of legitimate expectation and proportionality), equality, and retroactivity of tax law.
1.10. The Applicant also considers that the assessments now contested are vitiated by the defect of violation of law and error regarding the material and legal presuppositions, since, in light of what the CIMI [Property Tax Code] provides, it cannot be said that the Properties, being construction plots, have a residential purpose, since such purpose must always be present and effective and not merely potential and future, a conclusion which the regulatory innovation introduced in item 28.1 of the GTST by the State Budget Law for 2014 does not contradict.
1.11. Finally, the Applicant judges that the assessments now contested suffer from the defects of lack of substantiation and lack of prior hearing, determinative of their illegality.
1.12. The Applicant, on 28.04.2015 made payment of the amounts illegally collected, relating to the first installment, in a total of € 37,129.02 (thirty-seven thousand one hundred twenty-nine euros and two cents) and on 01.07.2015 to those relating to the second installment, in the total of € 37,129.01 (thirty-seven thousand one hundred twenty-nine euros and one cent), for which reason it requests compensation for damages suffered by it as a result of undue payment of tax installments.
C – Position of the Respondent
1.13. The Respondent contends that there is no doubt whatsoever that the Properties are construction plots, so that the wording of item 28.1 of the GTST introduced by Law no. 83-C/2013, of 31 December, which expressly refers to the CIMI for the definition of construction plot, must necessarily apply to the situation in question, and with this new wording the questions raised regarding the taxation of construction plots have been resolved.
1.14. It cannot also be ignored that the permit for the performance of urban development operations must contain, pursuant to Article 77th of the Legal Regime of Urban Development and Construction, the specification of a series of elements, so that, long before actual construction, it is possible to ascertain and determine the purpose of construction plots.
1.15. The legislative amendment which permits, unambiguously, the taxation of construction plots whose construction, authorized or planned, is for housing, aimed to expand the tax base, due to the need to correct the budgetary deficit, while respecting the constitutional principles of equality and tax capacity.
1.16. In fact, the Respondent contests the idea that the contested assessments violate constitutional principles, in particular the principles of equality (which does not entail the prohibition of any negative or positive discrimination, but only of discrimination lacking reasonable foundation) and tax capacity, and considers it acceptable, within the context of the depressed Portuguese economy, the limitation of the incidence of the taxation in question to luxury residential properties, excluding properties with strictly economic purposes.
1.17. The Respondent finally understands that no indemnity interest is due to the Applicant, as the payment made by it was not undue.
D – Conclusion of Report and Case Management
1.18. The Respondent, in its response, requested exemption from submitting the administrative file, from holding the meeting referred to in Article 18th of the TAR [Tax Arbitration Rules] and from filing arguments.
1.19. On 04.12.2015 the Applicant commented on the motion filed by the Tax and Customs Authority, opposing the exemption from submitting the administrative file and from filing arguments, and on the same day the arbitral tribunal gave the Respondent 10 (ten) days to submit to the case the instructional file, which it did.
1.20. On 07.12.2015 the Respondent requested the submission to the case of the Decision of the Constitutional Court no. 590/2015, of 11 November, which request was granted by the arbitral tribunal.
1.21. On 22.12.2015, the Applicant commented on the submission to the case of the Constitutional Court Decision referred to in 1.20 and, simultaneously, requested the submission to the case of a report and accounts for the fiscal year 2014.
1.22. On 08.01.2016, the Respondent exercised the right to reply regarding the aforesaid motion and also requested the submission to the case of the Arbitral Decision handed down in case no. 515/2015-T, the arbitral tribunal offering the Applicant the possibility, if it wished, to exercise the right to reply.
1.23. By order of 24.01.2016, the arbitral tribunal, vacating the order issued on 18.12.2015, denied the request for submission to the case of the Report and Accounts filed by the Applicant, as it understood that the document in question does not concern the disputed factual matters, exempted the holding of the meeting referred to in Article 18th of the TAR, setting a time limit for each party to file arguments, and further established 27.04.2016 as the deadline for issuing the arbitral award.
1.24. On 09.02.2016, the Applicant requested the submission to the case of evidence of payment of the third installment of the contested tax (documents nos. 12 to 15, following the order of documents submitted with the arbitration request).
1.25. The Parties filed their arguments, in line with what each had already set forth in the arbitration request and respective response.
1.26. On 19.04.2016, the Presiding Arbitrator, with the concurrence of the co-arbitrators, issued an order extending the arbitration deadline by two months, indicating 27.06.2016 as the deadline for issuing the decision.
1.27. The Parties have legal personality and capacity and have standing pursuant to Article 4th and paragraph 2 of Article 10th of the TAR, and Article 1st of Regulation no. 112-A/2011, of 22 March.
1.28. The cumulation of claims made in the present arbitration request, in deference to the principle of procedural economy, is justified since the contested assessment acts rest on the same factual basis and require the application of the same rules of law, and the indemnification claim formulated is also acceptable in principle since Article 3rd of the TAR, by expressly admitting the possibility of "cumulation of claims even if relating to different acts", accommodates, without hermeneutical abuse, the review of a claim that flows, in necessary terms, from the judgment that the arbitral tribunal reaches as to the validity of the assessments challenged.
1.29. The proceedings do not suffer from any nullity and no exceptions have been raised that prevent knowledge of the merits of the case, so the arbitral tribunal is in a position to issue the respective award.
2. Factual Matters
2.1. Facts Established
2.1.1. On the date of the arbitration request, the Applicant was the sole owner of the Properties (documents nos. 4 to 6, submitted with the arbitration request).
2.1.2. The Properties were described as construction plots with residential purpose (documents nos. 4 to 6, submitted with the arbitration request).
2.1.3. The Property referred to in 1.7.1, on the date of the facts, was assigned a TPV of € 5,080,766.67 (five million eighty thousand seven hundred sixty-six euros and sixty-seven cents) (document no. 4, submitted with the arbitration request).
2.1.4. The Property referred to in 1.7.2, on the date of the facts, was assigned a TPV of € 4,822,497.13 (four million eight hundred twenty-two thousand four hundred ninety-seven euros and thirteen cents) (document no. 5, submitted with the arbitration request).
2.1.5. The Property referred to in 1.7.3, on the date of the facts, was assigned a TPV of € 1,235,440.00 (one million two hundred thirty-five thousand four hundred forty euros) (document no. 6, submitted with the arbitration request).
2.1.6. The Applicant was notified of the ST assessments referred to in 1.1, the collection documents relating to the first installment of which were submitted with the arbitration request as documents nos. 1 to 3, in the global amount of € 111,387.04 (one hundred eleven thousand three hundred eighty-seven euros and four cents).
2.1.7. The Applicant, on 20.04.2015, made payment of the first installment of what was assessed to it, in the global amount of € 37,129.02 (thirty-seven thousand one hundred twenty-nine euros and two cents) (documents nos. 7 to 9, submitted with the arbitration request).
2.1.8. The Applicant, on 01.07.2015, made payment of the second installment of what was assessed to it, in the global amount of 37,129.01 (thirty-seven thousand one hundred twenty-nine euros and one cent) (documents nos. 10 to 12, submitted with the arbitration request).
2.1.9. The Applicant, on 10.11.2015, made payment of the third installment of what was assessed to it, in the global amount of 37,129.01 (thirty-seven thousand one hundred twenty-nine euros and one cent) (documents nos. 13 to 15, submitted with the arbitration request).
2.2. Facts Not Established
It was not established that the Municipal Council of ..., as well as the Municipal Council of ..., issued any order or final resolution regarding any request for urban development operation (preliminary information, licensing, prior notification), nor any authorization for subdivision or construction, relating to the urban properties of ... and ..., respectively.
It was not demonstrated, therefore, that, on the date of the facts, the properties in question had approved projects for construction, nor that there existed any other titles constitutive of the right to construct for residential purposes.
There are no other facts relevant to the review of the merits of the case that have been given as not established.
2.3. Reasoning for the Facts Established and Not Established
The reasoning for the facts given as established and not established was based on the position assumed by the parties and the documents submitted to the case file.
3. Legal Matters
3.1. Questions to be Decided
It follows from what has been stated above that the questions to be decided are, essentially:
a) Whether the Properties are construction plots "whose construction, authorized or planned, is for housing, pursuant to the provisions of the Property Tax Code" for purposes of applying Article 1st of the STC and item 28.1 of the GTST, as amended by Law no. 83-C/2013, of 31 December; and
b) If an affirmative answer is given to the previous question, whether item 28.1 of the GTST, as amended by Law no. 83-C/2013, of 31 December, is unconstitutional, if interpreted in the sense that the relevant taxable fact rests on an expectation of residential purpose, due to violation of the constitutional principles of equality and tax capacity; and, further,
c) To clarify whether, should the arbitration request be granted with the consequent annulment of the contested assessments, the Applicant, within the scope of the present arbitral proceedings, may obtain a judgment against the Respondent for payment of indemnity interest regarding the amounts paid by it for satisfaction of the tax illegally demanded by the latter.
3.2. Item 28.1 of the GTST
The principle of legality, understood in a broad sense (the lawfulness of administration), constitutes the presupposition and foundation of all administrative activity, such that only exceptionally may there be administrative activity directly linked to the Constitution[1].
Thus, it is important first to ascertain whether the tax assessment acts that are the subject of the present arbitration request conform to the immediate parameter to which the Tax and Customs Authority is bound, namely item 28.1 of the GTST, as amended by Law no. 83-C/2013, of 31 December.
3.2.1. Evolution and Framing of Item 28.1 of the GTST
It is worth citing the Decision of the Superior Administrative Court of 9/4/2014 (case no. 1870/13)[2], which, along with other decisions of that same court, provides a historical and chronological synthesis of the evolution and framing of item 28.1 of the GTST.
"The concept of '(urban) property with residential purpose' was not defined by the legislator. Neither in Law no. 55-A/2012, which introduced it, nor in the Property Tax Code, to which paragraph 2 of Article 67th of the Stamp Tax Code (equally introduced by that Law) refers, by way of subsidiary reference. And it is a concept which, probably due to its imprecision – a fact all the more serious given that the scope of the tax incidence is determined on the basis thereof – had a brief existence, as it was abandoned upon the entry into force of the State Budget Law for 2014 (Law no. 83-C/2013, of 31 December), which gave new wording to item no. 28 of the General Table, and which now determines its scope of tax incidence through the use of concepts that are legally defined in Article 6th of the Property Tax Code.
This amendment – to which the legislator did not attribute an interpretative character, nor does it appear to us that it did – merely renders unequivocal for the future that construction plots whose construction, authorized or planned, is for housing, are encompassed within the scope of item 28.1 of the General Table of Stamp Tax (provided that their respective tax patrimonial value is equal to or greater than 1 million euros)." (End of citation.)
Prior to the legislative amendment made by the State Budget Law for 2014, which began to include express reference to construction plots, it was necessary to ascertain whether such plots, despite the absence of express mention, could be included within the scope of tax incidence of item 28. We continue with the teachings of the decision we have just cited:
"[As the legislator clarifies nothing] regarding past situations [i.e., assessments prior to 2014], such as the one at issue in the present case, it does not seem that the interpretation of the appellant can be accepted [as to these], since it does not follow unequivocally, either from the letter or the spirit of the law, that the intention thereof was, ab initio, to encompass within its scope of tax incidence construction plots for which construction of residential buildings had been authorized or planned, as results today unequivocally from item 28.1 of the General Table of Stamp Tax.
From the letter of the law nothing unequivocal follows, in fact, as it itself, by using a concept which it did not define and which was also not defined in the legislation to which it referred by way of subsidiary reference, unnecessarily lent itself to ambiguities in a matter – of tax incidence – in which certainty and legal security should also be paramount concerns of the legislator.
And from its 'spirit', discernible in the statement of reasons of the draft law that is the origin of Law no. 55-A/2012 (Draft Law no. 96/XII – 2nd, Parliamentary Records, series A, no. 3, 21/09/2012, p. 44 [...]) there follows nothing more than the concern to generate new tax revenues from sources of wealth 'spared' in the past from the fiscal authorities' grasp than labor income, in particular capital gains, securities gains and property ownership, reasons which bring no relevant contribution to clarifying the concept of '(urban) properties with residential purpose', as they take it as established, without any concern to clarify it. Such clarification had, however, emerged – as reported in the Arbitral Decision issued on 12 December 2013, in case no. 144/2013-T, available in the CAAD database –, when that draft law was presented and discussed in Parliament, in the words of the Secretary of State for Tax Affairs, who is reported to have expressly stated, as appears in the Parliamentary Records (Series I no. 9/XII – 2, of 11 October, p. 32) that: 'The Government proposes the creation of a special tax on high-value urban residential properties. This is the first time in Portugal that a special tax has been created on high-value properties intended for housing. This tax will be 0.5% to 0.8% in 2012 and 1% in 2013, and will apply to houses with a value equal to or greater than 1 million euros' (emphasis ours), from which it can be understood that the reality intended to be taxed is, in fact, and notwithstanding the terminological imprecision of the law, '(urban) residential properties', in current language 'houses', and not other realities.
[...]. [...] referring the incidence provision of stamp tax to urban properties with 'residential purpose', without it being established what specific concept applies for that purpose, cannot be extracted therefrom that the same contains a future potentiality, inherent in a distinct property that may possibly be built on the land.
It is concluded therefore, in accordance with what was decided in the judgment under appeal that, as it results from Article 6th of the Property Tax Code a clear distinction between urban properties that are 'residential' and 'construction plots', these cannot be considered as 'properties with residential purpose' for purposes of item no. 28.1 of the General Table of Stamp Tax, in its original wording, as conferred by Law no. 55-A/2012, of 29 October." (End of citation.)
It seems clear, therefore, that the new wording of item 28.1 of the GTST, given by Article 194th of Law no. 83-C/2013, of 31 December (and applicable to the present case), intended to expand, in an innovative manner, the scope of tax incidence, by expressly including construction plots for which construction for housing had been authorized or planned.
3.2.2. The Notion of "Construction Plot whose Construction, Authorized or Planned, is for Housing, pursuant to the Property Tax Code"
Item 28.1 of the GTST (with the wording given by Law no. 83-C/2013, of 31 December, applicable in the present case) provides as follows: "For residential property or for construction plot whose construction, authorized or planned, is for housing, pursuant to the provisions of the Property Tax Code".
It is therefore important, in light of the letter of the provision now in force, to apprehend the meaning and scope of what should be understood as "construction plot whose construction, authorized or planned, is for housing, pursuant to the Property Tax Code"
"With regard to construction plots, whether or not located within an urban agglomeration, as defined in Article 3./4 of this legislation [PTCM], must, as such, be considered those plots in relation to which has been granted: - license for subdivision operation; - construction license; - authorization for subdivision operation; - construction authorization; - admitted favorable prior notification of subdivision or construction operation; issued favorable preliminary information on subdivision or construction operation, as well as; - those which have been so declared in the acquisition title, and it should be noted that, also for such effect, only the acquisition title in the form prescribed by civil law should be relevant, namely, the public deed or authenticated private document referred to in Article 875 CC." [cf. ANTÓNIO SANTOS ROCHA / EDUARDO JOSÉ MARTINS BRÁS – Taxation of Assets. IMI-IMT and Stamp Tax (Annotated and Commented). Coimbra, Almedina, 2015, p. 44].
It is necessary to conclude that the requirements listed above – which seem to clarify the legal and administrative requirements necessary for the consideration of any construction plots as plots encompassed by item 28.1 of the GTST – are not met in any of the Properties on which the tax assessment acts in question were levied.
In fact, no documents have been presented to this tribunal that attest to or even suggest that the assessments now contested were levied on properties with approved projects for construction for residential purposes, or on properties that are located in an area where construction for residential purposes is planned (with the aforesaid prior notifications or favorable preliminary information to the performance of subdivision or construction operations). Now, failing such demonstration, as occurs in the present case, it cannot be considered that the Properties, for purposes of applying item 28.1 of the GTST, have "construction, authorized or planned, for housing, pursuant to the PTCM".
Although the Properties are recorded in the property matrix as "construction plots", such registration does not entail the inevitable application of item 28.1 of the GTST, since it does not constitute, by itself, conclusive proof that a property has construction for residential purposes planned.
So much so that, as rightly point out ANTÓNIO SANTOS ROCHA and EDUARDO JOSÉ MARTINS BRÁS (op. cit., p. 46), "immovable properties situated in urbanized areas or included in areas covered by already-approved urban development plans [...] should only be considered as construction plots when, through action undertaken by their respective owner, there occurs, alternatively, the issuance of any of those documents ['granting of licenses, construction or subdivision authorizations, favorable prior notifications or preliminary information for the same purpose']".
The cited authors add (see ibidem) – reinforcing the understanding already expressed here, according to which, without licenses or construction authorizations, the mere registration of immovables as construction plots does not, by itself, legitimize the application of item 28.1 of the GTST –, the following:
"Immovable properties already described in the property matrix as construction plots, regarding which the expiration of the subdivision, license or construction authorization is verified, and in which not even the initiation of any construction operation has taken place, must, by means of the institute of expiration, recover the prior nature."
In the same sense, see also JOSÉ MANUEL FERNANDES PIRES, (Lessons in Taxes on Assets and Stamp Tax. Coimbra, Almedina, 3rd ed., 2015, pages 110 to 112): "The right to build is not inherent in the right of ownership, but is only born anew in the owner's patrimony when an administrative act by the competent public entity recognizes and authorizes the owner to build or subdivide. [...] only when that constitutive act is performed in the owner's legal sphere does the Property Tax Code establish that we are dealing with a construction plot. As such constitutive act is performed by the public entity at the request of the owner, then the classification of a property as a construction plot always depends on the owner's will."
Thus, it seems clear that for the verification of the regulatory provision it is not sufficient the mere property matrix registration of a property as a construction plot for residential purposes, since the delimitation of the scope of tax incidence now in question does not abandon the demonstration of an effective construction potentiality, necessarily revealed by the existence of the aforesaid documentary supports). This is to say that the incidence of the tax, for purposes of item 28.1, only materializes with the verification of the "effective purpose", to use the apt expression of JOSÉ MANUEL FERNANDES PIRES (op. cit., p. 507). In the same sense, cf., among others, the Arbitral Award issued by CAAD in case no. 467/2015-T.
Without the demonstration of such effective construction potentiality – which, as stated, did not occur in the case here analyzed – item 28.1 of the GTST is not shown to apply, reason for which it is concluded that the contested assessments incur the error invoked by the Applicant, such that they are not valid.
3.3. Indemnity Interest
Subparagraph b) of paragraph 1 of Article 24th of the TAR provides that "the arbitral decision on the merits of a claim not subject to appeal or challenge binds the tax administration from the end of the period provided for appeal or challenge, and the latter, in the exact terms of the finding of the arbitral decision in favor of the taxpayer and until the end of the period provided for voluntary execution of decisions of tax courts, shall restore the situation that would exist if the tax act that is the subject of the arbitral decision had not been performed, adopting the acts and operations necessary for that purpose".
It is not ignored that the legislative authorization granted to the Government by Article 124th of Law no. 3-B/2010, of 28 April, on the basis of which the TAR was approved, determines that the tax arbitral process constitutes an alternative means of proceedings to the process of judicial challenge and to the action for recognition of a right or legitimate interest in tax matters. Although subparagraphs a) and b) of paragraph 1 of Article 2nd of the TAR base the jurisdiction of arbitral tribunals on "declarations of illegality", it seems reasonable the understanding that their competence includes the powers that in judicial challenge proceedings are attributed to tax courts, and it is certain that in judicial challenge proceedings, in addition to the annulment of tax acts, claims for indemnification may be reviewed, including in particular those relating to indemnity interest.
In fact, the principle of cognoscibility of indemnification claims, in amicable settlement or in judicial proceedings, is justified whenever the damage that is sought to be remedied results from a fact attributable to the Tax and Customs Authority. We find manifestations of this principle in paragraph 1 of Article 43rd of the General Tax Law and in Article 61st of the Code of Tax Procedure and Process.
Thus, the review of the request for payment of indemnity interest filed by the Applicant is justified.
Indemnity interest is due when it is determined, in amicable settlement or judicial challenge, that there has been error attributable to the services as a result of which payment of the tax debt in an amount exceeding that legally due has been made.
Now, as the Applicant has paid the tax that by the assessments claimed it was, through error attributable to the services, demanded, it has the right not only to reimbursement of everything it paid but also to receive indemnity interest counted from the date of payment of each of the installments until its full reimbursement.
3.4. Questions Made Moot
The Applicant raised the question of the unconstitutionality of item 28.1 of the GTST, if interpreted in the sense that the stamp tax provided therein could be levied on the Properties. Since the arbitral tribunal did not accept such interpretation of that item, this question becomes moot and procedurally unnecessary, and likewise the review of any other defects that could affect the contested assessments.
4. Decision
Pursuant to and on the grounds set forth above, the arbitral tribunal decides:
a) To grant the arbitration request with the consequent annulment of the contested assessments, with all legal consequences, in particular the reimbursement to the Applicant of the amounts paid by it, regarding the assessments now annulled;
b) To grant the request for judgment against the Respondent for payment of indemnity interest, at the legal rate, such interest to be counted from the date of payment of each of the three installments relating to the taxes now declared undue until their full reimbursement.
5. Value of the Case
In accordance with the provisions of paragraph 2 of Article 306th of the CPC [Code of Civil Procedure], Article 97th-A of the CPPT [Code of Tax Procedure and Process] and also paragraph 2 of Article 3rd of the Regulation of Costs in Tax Arbitration Proceedings, the value of the case is set at € 111,387.04 (one hundred eleven thousand three hundred eighty-seven euros and four cents).
6. Costs
For the purposes of the provision in paragraph 2 of Article 12 and paragraph 4 of Article 22nd of the TAR and paragraph 4 of Article 4th of the Regulation of Costs in Tax Arbitration Proceedings, the amount of costs is set at € 3,060.00 (three thousand and sixty euros), pursuant to Table I annexed to the said Regulation, to be borne entirely by the Respondent.
Lisbon, 2 May 2016
The Arbitrators,
(Fernanda Maçãs)
(Nina Aguiar)
(Nuno Pombo)
Text prepared by computer, pursuant to paragraph 5 of Article 131st of the CPC, applicable by reference of subparagraph e) of paragraph 1 of Decree-Law no. 10/2011, of 20 January and with the spelling prior to the said Orthographic Agreement of 1990.
[1] Cf. GOMES CANOTILHO / VITAL MOREIRA – Constitution of the Portuguese Republic, Annotated. Coimbra, Coimbra Editora, 4th ed., 2014, pages 798 et seq..
[2] See Arbitral Award issued in case 467/2015-T, which equally refers to this clarifying decision of the Superior Administrative Court, whose conclusions we now adopt.
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