Summary
Full Decision
ARBITRATION DECISION
The arbitrators Cons. Jorge Lopes de Sousa (arbitrator-president), Dr. Ana Teixeira de Sousa and Dr. José Manuel Aurélio dos Santos, appointed by the Deontological Council of the Administrative Arbitration Center to form the Arbitration Tribunal, constituted on 28-03-2017, agree as follows:
1. Report
A…, S.A. (hereinafter referred to as "Claimant" or "A…"), legal entity number …, with registered office at …, no.…, …, …-… Algés, presented a request for constitution of the arbitration tribunal with a view to declaring the illegal rejection of the gracious complaint no. …2016… and, likewise, the illegality of the self-assessment of Corporate Income Tax (IRC), including autonomous taxation rates, of A…, relating to the fiscal year 2014, with regard to the amount of autonomous taxation rates in IRC of €125.362,41, with its consequent annulment in this respect, due to undue exclusion of the deduction from the collection, in view of the manifest illegality of the assessment in this respect, with all legal consequences, namely the reimbursement to the claimant of this amount, plus compensatory interest at the legal rate counted, until full reimbursement, from 1 September 2015.
Alternatively, should it be understood that article 90 of the IRC Code does not apply to autonomous taxation, the Claimant requests that the illegality of the assessment of autonomous taxation be declared (and consequently annulled) due to absence of legal basis for its implementation (cf. article 8, no. 2, subparagraph a), of the General Tax Law, and article 103, no. 3, of the Constitution), with the consequent reimbursement of the same amount and payment of compensatory interest counted from the same date.
The defendant is the TAX AUTHORITY AND CUSTOMS AUTHORITY.
The request for constitution of the arbitration tribunal was accepted by the President of CAAD and notified to the Tax and Customs Authority on 27-01-2017.
In accordance with the provisions of subparagraph a) of no. 2 of article 6 and subparagraph b) of no. 1 of article 11 of the Regulation on Tax Arbitration Proceedings (RJAT), the Deontological Council appointed as arbitrators of the collective arbitration tribunal the undersigned, who communicated their acceptance of the assignment within the applicable time period.
On 13-03-2017 the parties were duly notified of this appointment, and did not manifest their intention to refuse the appointment of the arbitrators, in accordance with the combined provisions of article 11, no. 1, subparagraphs a) and b) of the RJAT and articles 6 and 7 of the Deontological Code.
In accordance with the provisions of subparagraph c) of no. 1 of article 11 of the RJAT, the collective arbitration tribunal was constituted on 28-03-2017.
The Tax and Customs Authority responded, arguing for the rejection of the request for arbitral pronouncement.
By order of 10-05-2017 the meeting provided for in article 18 of the RJAT was dispensed with and it was decided that the proceedings would continue with successive written submissions.
Only the Claimant presented submissions.
The Arbitration Tribunal is competent, the parties have legal personality and capacity, are legitimate and are properly represented (arts. 4 and 10, no. 2, of the same statute and art. 1 of Administrative Order no. 112-A/2011, of 22 March).
The proceedings do not suffer from nullities and there is no obstacle to the examination of the merits of the case.
No exceptions are raised and there is no obstacle to the examination of the merits of the case.
2. Factual Matters
2.1. Proven Facts
The following facts are considered proven:
a) On 28 May 2015 the Claimant filed the income declaration Model 22 of Corporate Income Tax ("IRC") for the fiscal year 2014 (document no. 1 attached to the request for arbitral pronouncement, the content of which is reproduced);
b) In that declaration the Claimant carried out the self-assessment of autonomous taxation in IRC of the same year 2014, in the amount of €125.362,41;
c) The Claimant had SIFIDE available for use at the end of the fiscal year 2014 in the amount of €4.607.428,18 (document no. 3 attached to the request for arbitral pronouncement, the content of which is reproduced);
d) The Claimant did not make any deduction of the SIFIDE amount from the collection derived from autonomous taxation;
e) The Tax and Customs Authority did not determine taxable profit of A… by indirect methods;
f) The Claimant is not and was not an entity owing the State and social security any taxes or contributions regarding the years 2009 to 2015 (document no. 6 attached to the request for arbitral pronouncement, the content of which is reproduced);
g) The computer system of the Tax Authority prevents deduction of the SIFIDE amount from the collection related to autonomous taxation (articles 21, 22, 27 and 28 of the request for arbitral pronouncement, which are not contested);
h) On 29-02-2016, the Claimant filed a gracious complaint of the self-assessment, and it was assigned the number …2016… (document no. 2 attached to the request for arbitral pronouncement, the content of which is reproduced);
i) The said gracious complaint was rejected by order of 13-10-2016, issued by the Chief of the Finance Directorate Division, under Sub-delegation of Powers (document no. 2 attached to the request for arbitral pronouncement, the content of which is reproduced);
j) The said order manifests agreement with an information the content of which is reproduced, in which it is stated, among other things, the following:
I - BRIEF DESCRIPTION OF THE CLAIMANT'S SUBMISSIONS
1 - The taxpayer identified herein submits a gracious complaint against the self-assessment of IRC for the fiscal year 2014 made in the income declaration mod. 22 (pages 19 to 27 of the file).
2 - It requests the reimbursement of the amount of €125.362,41, arguing, in summary, the following:
• It is well-established in doctrine and case law that autonomous taxation assumes the nature of IRC.
• Given that there is no provision in the IRC Code that provides specific terms for the assessment of autonomous taxation, it must be concluded that article 90 thereof covers the determination of the amount of collection resulting from the rates applicable to the taxable facts which, by virtue of article 88 of the same Code, are subject to autonomous taxation, especially since this tax assumes the nature of IRC.
• The DSIRC (Tax and Customs Directorate), having regard to its understanding of the nature of autonomous taxation (attached document from pages 29 to 36), admits the possibility that both SIFIDE fiscal credits approved in the taxation period itself and those relating to prior periods and which are still available for deduction be deducted from its amount.
• Given that the claimant determined a collection of autonomous taxation in the amount of €125.362,41, in light of that understanding, could have deducted, up to its amount, the value of tax benefits - in this case, SIFIDE - still available. The value of SIFIDE that was available for deduction in the period of 2014, and which was not deducted due to alleged insufficiency of collection, amounted to €4.603.239,40.
• Alternatively, if the Tax Authority considers it not possible to make the deduction of the SIFIDE fiscal credit from the amount of autonomous taxation, arguing that its assessment does not fall within article 90 of the IRC Code, then the claimant considers that such autonomous taxation would not be due due to the absence of an assessment rule, for which reason it requests reimbursement of the respective amount.
3 - It further requests compensatory interest, under article 43 of the General Tax Law, on the amount paid unduly.
II - ANALYSIS OF THE REQUEST
1 - The claimant has legitimacy (article 9 of the Code of Tax Procedure and Process), and the request is legal and was presented in time, within the two-year period following the filing of the declaration, in accordance with no. 1 of article 131 of the Code of Tax Procedure and Process (filing dates of declaration m/22, 28-05-2015, page 19; complaint filed on 29-02-2016, page 4).
For the purposes of the provisions of no. 3 of article 111 of the Code of Tax Procedure and Process, it was verified, by consultation of the Computer System, that until the present date no judicial challenge with the object of the complaint under analysis has been filed.
2 - The claimant argues that the value of the SIFIDE fiscal benefit to be deducted with reference to the fiscal year 2014 should be able to be deducted from the autonomous taxation determined in the declaration mod. 22 of that fiscal year, based on no. 2 of article 90 of the IRC Code, because autonomous taxation has the nature of IRC and because there is no assessment rule beyond that article 90.
Indeed, the autonomous taxation referred to in article 88 of the IRC Code has the nature of IRC, but assessed autonomously.
Contrary to what is stated in the complaint, the information of the DSIRC attached to it (pages 29 to 36) does not mention the possibility of any deduction from the amount of autonomous taxation.
In accordance with the provisions of no. 21, added to article 88 of the IRC Code by Law no. 7-A/2016 of 30/3 (State Budget Law for 2016): "The assessment of autonomous taxation in IRC is carried out in accordance with the terms provided for in article 89° and is based on the values and rates resulting from the provisions of the preceding numbers, with no deductions being made from the total amount determined."
That no. 21 was given interpretative status by article 135 of the same law.
Thus, based on this legal rule, fiscal benefits are not deductible from the amount of autonomous taxation.
As for the allegation, as a matter of alternative argument, of absence of legal basis for the assessment of autonomous taxation, it should be noted, as expressed in the rule transcribed above, that the respective assessment is carried out in accordance with the terms provided for in article 89°, based on the values and rates resulting from the provisions in article 88°, both of the IRC Code.
3 - Given that, as stated in the previous point, the claimant's argument has no merit, it is proposed that the request be rejected, maintaining the IRC assessment subject to the complaint.
It is further added that, given that the prerequisites of no. 1 of article 43 of the General Tax Law are not met in this case, the claimant has no right to compensatory interest.
III - PRIOR HEARING
The claimant was notified of the draft decision to reject by electronic data transmission on 06-09-2016, as appears from pages 45 and 46 of the file, to exercise the right to prior hearing provided for in article 60 of the General Tax Law.
With the notification a copy of the draft decision was sent, and the 15-day period in accordance with no. 6 of article 60 of the General Tax Law was respected.
Upon expiry of the said period, the claimant did not exercise the right.
Given the above, and having regard to the facts and grounds invoked in the previous points and which reproduce the said draft decision, it is proposed that the request be decided in the same sense as the rejection (cf. point III-3 above).
k) On 16-01-2017, the Claimant filed the request for arbitral pronouncement that gave rise to the present proceedings.
2.2. Unproven Facts
There are no facts relevant to the decision that have not been proven.
2.3. Grounds for Fixing the Factual Matters
The proven facts are based on the documents submitted by the Claimant and which also appear in the administrative file.
As for the facts relating to the computer system of the Tax and Customs Authority and the inability to deduct the amounts of fiscal benefits from the collection derived from autonomous taxation, the Tax and Customs Authority itself confirms this is so and argues, in summary, that it should be so (articles 124 and 125 of the response).
The factual matters are not contested.
3. Legal Matters
The issue that is the object of the proceedings is whether investment expenses that benefit from SIFIDE can be deducted from the amounts due by way of autonomous taxation.
3.1. Applicability of Articles 89 and 90 of the IRC Code to the Calculation of Autonomous Taxation
Articles 89 and 90 of the IRC Code establish the following, in the wording of Law no. 2/2014, of 16 January, in effect during the year 2014:
Article 89
Competence for Assessment
The assessment of IRC is carried out:
a) By the taxpayer itself, in the declarations referred to in articles 120 and 122;
b) By the Directorate-General of Taxes, in the remaining cases.
Article 90
Procedure and Form of Assessment
1 - The assessment of IRC is processed in the following terms:
a) When the assessment must be made by the taxpayer in the declarations referred to in articles 120 and 122, it is based on the taxable matter contained therein;
b) In the event of failure to file the declaration referred to in article 120, the assessment is carried out until 30 November of the following year to which it relates or, in the case provided for in no. 2 of the said article, until the end of the 6th month following the expiry of the deadline for filing the declaration mentioned therein and is based on the value of the annual minimum monthly remuneration or, if greater, the entirety of the taxable matter of the closest fiscal year that is determined;
c) In the absence of assessment in accordance with the previous subparagraphs, the same is based on the elements available to the tax administration.
2 – The amount determined in accordance with the preceding number shall be subject to the following deductions, in the order indicated:
a) That corresponding to international double taxation;
b) That relating to fiscal benefits;
c) That relating to the special advance payment referred to in article 106;
d) That relating to withholdings at source not subject to compensation or reimbursement in accordance with applicable legislation.
3 – (Repealed by Law no. 3-B/2010)
4 - The amount determined in accordance with no. 1, with respect to the entities mentioned in no. 4 of article 120, only the deduction relating to withholdings at source when these have the nature of a tax on account of IRC is to be made.
5 - The deductions referred to in no. 2 relating to entities to which the transparent taxation regime established in article 6 is applicable are imputed to their respective partners or members in accordance with the terms established in no. 3 of that article and deducted from the amount determined on the basis of the taxable matter which has taken into account the imputation provided for in the same article.
6 - When the special regime for taxation of groups of companies is applicable, the deductions referred to in no. 2 relating to each of the companies are made in the amount determined with respect to the group, in accordance with no. 1.
7 – The deductions made in accordance with subparagraphs a), b) and c) of no. 2 cannot result in a negative value.
8 - With respect to taxpayers covered by the simplified regime for determining taxable matter, the amount determined in accordance with no. 1 shall only be subject to the deductions provided for in subparagraphs a) and e) of no. 2.
9 - The deductions made in accordance with subparagraphs a) to d) of no. 2 cannot result in a negative value.
10 - The amount determined in accordance with subparagraphs b) and c) of no. 1 is only subject to deductions of which the tax administration has knowledge and which can be made in accordance with nos. 2 to 4.
11 - In cases where the provisions of subparagraph b) of no. 2 of article 79 are applicable, annual assessments shall be made based on taxable matter determined on a provisional basis, and, in relation to the assessment corresponding to the taxable matter relating to the entire assessment period, the difference determined shall be collected or cancelled.
The said articles 89 and 90 of the IRC Code, as well as other provisions of this Code, such as those relating to the declarations provided for in articles 120 and 122, are applicable to autonomous taxation.
Indeed, it is nowadays uncontroversial, following numerous arbitral case law and the positions assumed by the Tax and Customs Authority, that the tax collected on the basis of autonomous taxation provided for in the IRC Code has the nature of IRC. Moreover, in addition to case law, article 23-A no. 1, subparagraph a), of the IRC Code, in the wording of Law no. 2/2014, of 16 January, leaves no room today for any reasonable doubt, corroborating what previously resulted from the literal wording of article 12 of the same Code.
Now, article 90 of the IRC Code refers to the forms of assessment of IRC, by the taxpayer or by the Tax Administration, applying to the determination of the tax due in all situations provided for in the Code, including additional assessment (no. 10).
Therefore, that article 90 also applies to the assessment of the amount of autonomous taxation, which is determined by the taxpayer or by the Tax Administration, following the filing or non-filing of declarations, there being no other provision that provides for different terms for its assessment.
Thus, the differences between the determination of the amount resulting from autonomous taxation and that resulting from taxable profit are restricted to the determination of the taxable matter and the applicable rates, which are those provided for in Chapters III and IV of the IRC Code for IRC based on taxable profit and in article 88 of the IRC Code for IRC based on the taxable matter of autonomous taxation and the respective rates.
However, the forms of assessment provided for in Chapter V of the same Code are of common application to autonomous taxation and to the remaining taxable matter of IRC.
However, the fact that a self-assessment of IRC, made in accordance with no. 1 of article 90, may contain several partial calculations based on various rates applicable to certain taxable matters does not imply that there is more than one assessment, as results from the very terms of that rule when referring to "assessment," in the singular, in all cases where it is "made by the taxpayer in the declarations referred to in articles 120 and 122," having "as its basis the taxable matter contained therein" (whether determined according to the rules of articles 17 and et seq. or determined according to the various situations provided for in article 88).
Moreover, it is not only the assessments provided for in article 88 that may encompass several calculations of application of rates to certain taxable matters, as the same may occur in the situations provided for in nos. 4 to 6 of article 87. ( [1] )
In any event, whatever calculations are to be made, it is a unitary self-assessment that the taxpayer or the Tax and Customs Authority must carry out in accordance with articles 89, subparagraph a), 90, no. 1, subparagraphs a), b) and c), and 120 or 122, and on the basis of it that global IRC is calculated, whatever the taxable matters relating to each of the types of taxation that underlie it. ( [2] )
Indeed, if this article 90 were not applicable to the assessment of autonomous taxation provided for in the IRC Code, we would have to conclude that there would be no provision providing for its assessment, which would amount to illegality, due to violation of article 103, no. 3, of the Constitution, which requires that the assessment of taxes be made "in accordance with the law."
It should also be noted the new rule of no. 21 added to article 88 of the IRC Code by Law no. 7-A/2016, of 30 March, regardless of whether or not it is truly interpretative, in no way alters this conclusion, as there it is established, with respect to the form of assessment of autonomous taxation, that it "is carried out in accordance with the terms provided for in article 89 and is based on the values and rates resulting from the provisions of the preceding numbers."
Indeed, if it is true that this new rule comes to clarify how the amounts of autonomous taxation are calculated (which already resulted from the very text of the various provisions of article 88) and that competence lies with the taxpayer or the Tax Administration, in accordance with article 89, it is also clear that it does not negate the need to use the procedure provided for in no. 1 of article 90, particularly in the cases provided for in its subparagraph c) where the assessment is the responsibility of the Tax and Customs Authority, with "as its basis the elements available to the tax administration," which will encompass the possibility of assessing on the basis of autonomous taxation, if the Tax and Customs Authority has elements that prove its prerequisites.
Therefore, both before and after Law no. 7-A/2016, of 30 March, article 90, no. 1, of the IRC Code is applicable to the assessment of autonomous taxation.
Thus, the examination of the subsidiary request that the Claimant has made conditional on the understanding that article 90 of the IRC Code is not applicable to autonomous taxation is already prejudiced.
3.2. Deductibility of Investment Expenses Provided for in SIFIDE from the Collection of IRC Derived from Autonomous Taxation
In 2014, the System of Tax Incentives for Business Research and Development II (SIFIDE II) was in effect, which was approved by article 133 of Law no. 55-A/2010, of 31 December, and amended by article 163 of Law no. 64-B/2011, of 30 December.
This statute establishes the following, in its articles 4 and 5:
Article 4
Scope of Deduction
1 - IRC taxpayers resident in Portuguese territory who carry on, as a principal activity, an activity of an agricultural, industrial, commercial and service nature and non-residents with a permanent establishment in that territory may deduct from the amount determined in accordance with article 90 of the IRC Code, and up to its amount, the value corresponding to research and development expenses, in the part that has not been subject to financial grant from the State on a non-refundable basis, carried out in the taxation periods from 1 January 2011 to 31 December 2015, in a double percentage:
a) Base rate - 32.5% of the expenses incurred in that period;
b) Incremental rate - 50% of the increase in expenses incurred in that period in relation to the simple arithmetic average of the two preceding fiscal years, up to the limit of (euro) 1,500,000.
2 - For IRC taxpayers that are SMEs in accordance with the definition contained in article 2 of Decree-Law no. 372/2007, of 6 November, which have not yet completed two fiscal years and which have not benefited from the incremental rate set in subparagraph b) of the preceding number, an increase of 10% is applied to the base rate set in subparagraph a) of the preceding number.
3 - The deduction is made, in accordance with article 90 of the IRC Code, in the assessment relating to the taxation period mentioned in the preceding number.
4 - Expenses that, due to insufficient collection, cannot be deducted in the fiscal year in which they were incurred may be deducted up to the sixth immediate fiscal year.
5 - For the purposes of the preceding numbers, when in the year of commencement of enjoyment of the benefit a change of the taxation period occurs, the annual period that begins in that year must be considered.
6 - The incremental rate provided for in subparagraph b) of no. 1 is increased by 20 percentage points for expenses relating to the hiring of doctoral holders by companies for research and development activities, and the limit provided for in the same subparagraph becomes (euro) 1,800,000.
7 - To taxpayers that reorganize, as a result of concentration acts as defined in article 73 of the IRC Code, the provisions of no. 3 of article 15 of the Statute of Fiscal Benefits apply.
Article 5
Conditions
Only the IRC taxpayers referred to in article 4 who cumulatively meet the following conditions may benefit from the deduction:
a) Their taxable profit is not determined by indirect methods;
b) They are not debtors to the State and social security of any taxes or contributions, or have their payment duly assured.
In the case at hand, the Tax and Customs Authority does not question that the Claimant meets the subjective and objective requirements to benefit from SIFIDE, having rejected the gracious complaint because it understood that the expenses in question cannot be deducted from the amounts it paid by way of autonomous taxation, because the deduction can only be made from the collection of IRC resulting from the application of the IRC rate to taxable profit.
As stated, article 90 of the IRC Code also refers to the assessment of autonomous taxation.
And, as has also been said, there is no legal support to assert that, in the eventuality of several calculations having to be made in a declaration to determine IRC, more than one self-assessment is carried out.
The statute that approved SIFIDE does not state that the credits arising from it are deductible from any and all collection of IRC, but rather defines the scope of the deduction by referring, in its no. 1 of article 4, "to the amount determined in accordance with article 90 of the IRC Code, and up to its amount."
No. 3 of the same article 4 confirms that it is to the amount to be determined in accordance with article 90 of the IRC Code that is relevant to carry out the deduction by stating that "the deduction is made, in accordance with article 90 of the IRC Code, in the assessment relating to the taxation period mentioned in the preceding number."
Thus, by mere declarative interpretation, it is concluded that article 4, no. 1, of SIFIDE II, by establishing the deduction "to the amount determined in accordance with article 90 of the IRC Code, and up to its amount," implies the deduction from the amount of autonomous taxation which is determined in accordance with that article 90.
The fact that article 5 of SIFIDE II excludes the benefit when taxable profit is determined by indirect methods and that autonomous taxation includes situations in which it aims to indirectly tax profits (namely, by not giving relevance to or discouraging facts susceptible to reducing them) has no relevance for this purpose, because the concept of "indirect methods" has a precise scope in tax law, which is concretized in article 90 of the General Tax Law (in addition to special rules), referring to means of determining taxable profit, the use of which is not provided for in the calculation of the taxable matter of autonomous taxation provided for in article 88 of the IRC Code.
On the other hand, if it is the need to use indirect methods that excludes the possibility of enjoying the benefit, this exclusion cannot be justified with respect to the collection of autonomous taxation, which is determined by direct methods.
Furthermore, it is not possible to see, in the eventual nature of anti-abuse rules that some autonomous taxation assumes, ( [3] ) an explanation for its exclusion from the respective collection from the scope of the deductibility of the SIFIDE II benefit, since there is no legal support to exclude deductibility from collection provided by corrections based on rules of an undisputably anti-abuse nature, such as, for example, those relating to transfer pricing or under-capitalization.
On the other hand, the fact that the deductibility of the SIFIDE II fiscal benefit is limited to the collection of article 90 of the IRC Code, up to its amount, does not allow the conclusion that the fiscal credit is only deductible if there is taxable profit, because what that fact requires is that there be IRC collection, which may exist even without taxable profit, particularly by virtue of autonomous taxation.
Thus, pointing to the literal wording of article 4 of SIFIDE II to the effect that the deduction also applies to the IRC collection derived from autonomous taxation determined in accordance with article 90 of the IRC Code, only by way of a restrictive interpretation can the application of the fiscal benefit to the IRC collection provided by autonomous taxation be excluded.
The viability of a restrictive interpretation finds, from the outset, an obstacle of a general nature, which is that the rules creating fiscal benefits have the nature of exceptional rules, as results from the express wording of article 2, no. 1, of the Statute of Fiscal Benefits, so, in the absence of a special rule, they should be interpreted in their precise terms, as is established case law. ( [4] ) In the case of fiscal benefits, the possibility of extensive interpretation is explicitly provided for (article 10 of the Statute of Fiscal Benefits), but not restrictive interpretation, so, as a rule, the fiscal benefit should not be interpreted with less amplitude than that which, in a declarative interpretation, results from the wording of the rule that provides for it.
In any event, a restrictive interpretation is only justified when "the interpreter concludes that the legislator adopted a text that betrays his thinking, in that it says more than what he intended to say. Also here the ratio legis will have a decisive word. The interpreter should not be drawn along by the apparent scope of the text, but should restrict it in order to make it compatible with legislative thinking, that is, with that ratio. The argument on which this type of interpretation is based is usually expressed as follows: cessante ratione legis cessat eius dispositio (where the reason for being of the law ends, its scope ends)." ( [5] )
As grounds for a restrictive interpretation, one might venture the fact that some autonomous taxation aims to discourage certain behavior by taxpayers susceptible to affecting taxable profit, and, consequently, reducing tax revenue, and its deterrent force would be attenuated with the possibility of the respective collection being subject to deductions.
However, the deterrent effect of such behavior is justified only by concerns of tax revenue protection and the fiscal benefits granted are, by definition, "measures of an exceptional character instituted for the protection of relevant extra-fiscal public interests that are superior to those of the taxation that they prevent" (article 2, no. 1, of the Statute of Fiscal Benefits).
And, in the case of the fiscal benefits of SIFIDE II, the extra-fiscal reasons that justify their overriding of tax revenues are, from the legislative perspective, of enormous importance, as inferred from the justification in the Report of the State Budget for 2011:
II.2.2.4.4. System of Tax Incentives for Business Research and Development II (SIFIDE)
Given that one of the assets of competitiveness in Portugal passes through the bet on technological capacity, scientific employment and conditions of assertion in the European space, the Proposal of the State Budget for 2011 proposes to renew SIFIDE (System of Tax Incentives for Business Research and Development), now in the version SIFIDE II, to be in effect in the periods from 2011 to 2015, allowing the deduction from IRC collection for companies that bet on R&D (research and development capacity).
Given the positive balance of fiscal incentives for business R&D, and also considering the evolution of the support system in other countries, it was decided to review and reintroduce for a further five taxation periods this support system. Business R&D is a decisive factor not only for their own assertion as competitive structures, but also for productivity and long-term economic growth, a fact, moreover, expressly recognized in the Program of the XVIII Government, as well as in several recent international reports.
It is in this context that, in the international panorama, the OECD has considered Portugal since 2001 as one of the three countries with the most significant progress in business R&D. Being the national system in effect, comparatively to the other systems that use deduction from collection and the distinction between base rate and incremental rate, is one of the most attractive and competitive.
Since the research and development of companies is "a decisive factor not only for their own assertion as competitive structures, but also for productivity and long-term economic growth," it is understandable that priority has been given to encouraging the bet on technological capacity, scientific employment and conditions of assertion in the European space, which, in the long term is attributed to obtaining greater tax revenues.
The importance that, from the legislative perspective, was recognized in this fiscal benefit provided for in SIFIDE II, is decisively confirmed by the fact that it is indicated as being especially excluded from the general limit to the relevance of fiscal benefits in IRC, which is indicated in article 92 of the IRC Code.
Therefore, it is clear that we are dealing with fiscal benefits whose justification is legislatively considered more relevant than the obtaining of tax revenues, inferring from that article 92 that the legislative intention to encourage investments in research and development provided for in SIFIDE II is so firm that it goes to the point of not even establishing any limit to the deductibility from the IRC collection, despite this fiscal regime having been created and applied in a period of notorious difficulties in public finances.
Thus, no legal basis is seen, particularly in light of the legislative intention that can be detected, for, on the basis of a restrictive interpretation, excluding the deductibility of the SIFIDE II fiscal benefit from the collection of autonomous taxation that results directly from the letter of article 4, no. 1, of the respective statute, combined with article 90 of the IRC Code.
On the other hand, any limitation of the application of the fiscal benefit to companies that presented taxable profit in 2014 would amount to a very strong restriction of its field of application, since, as is a public fact, the vast majority of companies, in that year and in previous years, showed tax losses, although they paid IRC by other means.
In fact, according to statistics published by the Tax and Customs Authority, in the year 2011 (the last year whose data would have been available when the Proposal of the State Budget for 2012 was presented, and thus it is to be assumed that it was considered in the assessment of the scope of the fiscal benefit), more than half of the IRC declarations presented negative net value and in the taxation period of 2011 only 26% of taxpayers presented Assessed IRC (Table 7), and approximately 71% of taxpayers made IRC payments (Table 8), by means of Special Advance Payment on Account, or other positive components of the tax (Autonomous Taxation, Municipal Surtax, State Surtax, IRC from prior taxation periods, etc.). ( [6] ).
Therefore, it is manifest that the applicability of the fiscal benefit to companies that, although presenting tax losses, paid IRC, including by way of autonomous taxation, greatly expanded the number of potentially eligible companies and, consequently, is more compatible with the legislative intention underlying SIFIDE II than that defended by the Tax and Customs Authority.
On the other hand, as stated, it cannot be overlooked that autonomous taxation aims to protect or increase tax revenue and that the fiscal benefits granted are, by definition, "measures of an exceptional character instituted for the protection of relevant extra-fiscal public interests that are superior to those of the taxation that they prevent" (article 2, no. 1, of the Statute of Fiscal Benefits).
That is, in the case at hand, by establishing a fiscal benefit by deduction from IRC collection, the legislator chose to dispense with the tax revenue that this tax could provide, to the extent of the granting of the fiscal benefit. For this assessment of the relative interests at stake (tax revenue versus strong stimulus to investment) it is indifferent whether that revenue comes from calculations made on the basis of article 87 or article 88 of the IRC Code. In fact, whatever the form of calculation of that tax revenue, we are dealing with money whose collection the legislator considered to be less important than the pursuit of the economic purpose mentioned. Of the two alternatives that were presented to the legislator with respect to the encouragement of investments provided for in SIFIDE II, which were, on the one hand, to keep intact the revenues from IRC (including those from autonomous taxation) and not see investment encouraged and, on the other hand, to achieve that encouragement with loss of IRC revenues, the assessment necessarily underlying SIFIDE II is that of choosing to create the encouragement with detriment to revenues. And, naturally, since the creation of the investment encouragement is better, from the legislative perspective, than the collection of revenues, it is not seen how it can be relevant that the IRC revenues that are lost to realize the encouragement come from the general taxation of IRC provided for in no. 1 of article 87 or from taxation at special rates provided for in nos. 4 to 6 of the same article, or from autonomous taxation provided for in article 88: in all cases, the alternative is the same between creating the encouragement and collecting IRC revenues and the relative assessment that can be made of the conflicting interests is identical, whatever the ways of determining the amount of IRC that is foregone to create the encouragement.
And, in the case of the SIFIDE II fiscal benefit, the extra-fiscal reasons that justify the encouragement with loss of revenue are very strong, since it is considered that the encouraged investments are a decisive factor in the country's future competitiveness, which is fundamental to the very increase in tax revenues.
Therefore, it is clear that we are dealing with a fiscal benefit whose justification is legislatively considered more relevant than the obtaining of tax revenues from IRC, whatever the basis of its calculation, because what is at issue is always whether or not to forgo a certain amount of money to create an investment encouragement.
In this context, the nature of autonomous taxation and the solutions legislatively adopted, in general, with respect to them, have no relevance for the assessment of this issue, since this must be assessed in light of the specific interests that clash in its assessment.
In fact, what is at issue is, exclusively, to determine the scope of SIFIDE II, which establishes a regime of an exceptional nature, which aimed to pursue certain public interests, and not to contribute to the decision of any conceptual issue regarding the nature of autonomous taxation, a matter on which neither in the text of the law nor in the Report of the Budget for 2011 is there the slightest legislative concern.
For the same reason that what is at issue is to interpret the scope of the statute of a special nature that is SIFIDE II, the rule of no. 21 of article 88 of the IRC Code, added by Law no. 7-A/2016, of 30 March, to the extent that it refers that no "deductions are made from the total amount determined," cannot be given relevance for this purpose, despite the purported interpretative status that was given to it.
Indeed, there is no sign, neither in Law no. 7-A/2016, nor in the Report of the Budget for 2016, nor in its discussion, that with the addition to article 88 of the IRC Code of a general rule prohibiting deductions from the total amount determined of autonomous taxation, it was intended to restrictively interpret the expression "deduct from the amount determined in accordance with article 90 of the IRC Code" which appears in a special rule of a separate statute, as is SIFIDE II.
And, in the absence of an unequivocal intention to the contrary, the rule applies that general law does not alter special law (article 7, no. 3, of the Civil Code), which has its justification in the fact that "the general regime does not include consideration of the particular conditions that precisely justified the emission of the special law." ( [7] )
Furthermore, the referred rules of SIFIDE II are intended to encourage IRC taxpayers to make investments in the period between 01-01-2011 and 31-12-2015, so that, the fiscal benefit being a counterpart of the adoption of the legislatively desired and encouraged behavior, it would be incompatible with the constitutional principle of trust, inherent in the principle of the democratic rule of law (article 2 of the Constitution), not to recognize to such behaviors the favorable fiscal effects provided for in the law in effect at the time they occurred. Therefore, if hypothetically Law no. 7-A/2016 intended to eliminate, totally or partially, the favorable fiscal effects that SIFIDE II promised to taxpayers who, with justified trust, adopted the behavior provided for therein, it would be materially unconstitutional, due to violation of that principle.
From the above, converging the literal and rational elements of the interpretation of article 4 of SIFIDE II in the sense that the investment expenses provided for therein are deductible from "the amount determined in accordance with article 90 of the IRC Code, and up to its amount," it is to be concluded that they are deductible from the entirety of that collection, which encompasses, in addition, that derived from the taxation of profits in each fiscal period, that resulting from the special advance payment on account and other positive components of the tax, namely autonomous taxation, state surtax and IRC from prior taxation periods.
Therefore, the request for arbitral pronouncement is procedurally meritorious as to this issue, since the self-assessment and the decision on the gracious complaint that confirmed it are illegal.
These illegalities justify the annulment of the self-assessment, in the part at issue, and of the decision on the gracious complaint, in accordance with article 163, no. 1, of the Administrative Procedure Code, subsidiarily applicable in accordance with article 2, subparagraph c), of the General Tax Law.
3.3. Constitutional Issues Raised by the Tax and Customs Authority
The Tax and Customs Authority states in article 134 of its Response the following:
"It is always to be said that any interpretation that does not apply the rule contained in the State Budget Law for 2016, embodied in article 133, which added number 21 to article 88 of the IRC Code, with the effects provided for in article 135, both contained in the State Budget Law for 2016, published on 30.03.2016, entering into force on the following day, in which it is recommended, with an interpretative character, that
'The assessment of autonomous taxation in IRC is carried out in accordance with the terms provided for in article 89° and is based on the values and rates resulting from the provisions of the preceding numbers, with no deductions being made from the total amount determined.'
and which, consequently, permits the deduction from the part of IRC collection produced by autonomous taxation rates of fiscal benefits made under IRC, in this case, SIFIDE/CFEI/RFAI, such decision is materially unconstitutional, by
a) violation of the principle of legality, inherent in article 103, no. 2 of the Constitution,
b) violation of the principle of separation of powers, embodied in article 2 of the Constitution,
c) violation of the principle of protection of trust provided for in article 2 of the Constitution,
d) violation of the principle of equality, in its positive formulation of contributory capacity, arising from article 13, no. 2 and article 103, no. 2, both of the Constitution."
It is noted that the Tax and Customs Authority does not explain the reason or reasons why it understands that these principles are violated, limiting itself to referring to them, so it did not fulfill, as to these hypothetical issues, the essential burden of allegation necessary to ensure the right to be heard.
In any event, with the brevity that the insufficiency of allegation justifies, it may be said that it is not seen how the principle of legality can be violated, since legality has precisely the scope referred to above and, in particular, the general rule of number 21 of article 88 of the IRC Code, even applied to prior situations, has no potentiality to revoke special rules, such as those of SIFIDE II which provide for the deduction from IRC collection, which includes that of autonomous taxation. Being this the appropriate interpretation of the said rules, what would be incompatible with the principle of legality would be to apply them with scope different from that which results from the appropriate interpretative rules.
As for the principle of separation of powers, the present decision is issued by a Court, and thus has a jurisdictional character, and, in the exercise of jurisdictional power, it is the Courts that have the duty to interpret and apply the laws. In this case, this Court interpreted all the rules at issue, including no. 21 of article 88 of the IRC Code, in the sense it stated and not in another. Therefore, the present arbitral decision is a concretization of the principle of separation of powers.
With respect to the principle of protection of trust, even if it is understood that its scope of protection extends to the State Administration, it certainly does not encompass trust that courts will adopt a certain interpretation, when case law is not settled.
As for the principle of equality, no equiparable situation is identified that has been given different treatment. Furthermore, autonomous taxation is not based on the contributory capacity of companies, since its autonomous taxation is concretized, precisely, in the imposition of taxation regardless of the existence of income, being exceptions to the principle of taxation of companies with incidence "fundamentally on their actual income" (article 104, no. 2, of the Constitution). Therefore, it is not seen how the principle of equality is violated, and much less article 103, no. 2, of the Constitution, which refers to the formal requirements of tax laws.
From the above, there is no violation of the principles invoked.
4. Reimbursement of Amounts Paid and Compensatory Interest
The Claimant requests the reimbursement of the amount of €125.362,41 referring to the amount of autonomous taxation unduly paid and delivered to the State coffers as a result of the non-deduction of SIFIDE.
The Claimant further requests compensatory interest calculated on the amount to be refunded, counted from 01-09-2015, the day following the date when it considers that it should have been refunded the said amount.
In accordance with the provisions of subparagraph b) of article 24 of the Regulation on Tax Arbitration Proceedings, the arbitral decision on the merits of the claim from which no appeal or challenge can be brought binds the Tax Administration from the expiry of the period provided for appeal or challenge, and this Administration must, in the exact terms of the admissibility of the arbitral decision in favor of the taxpayer and until the expiry of the period provided for the voluntary execution of sentences of tax courts, "restore the situation that would exist if the tax act that is the object of the arbitral decision had not been carried out, adopting the acts and operations necessary for that purpose," which is in harmony with the provisions of article 100 of the General Tax Law [applicable by virtue of the provisions of subparagraph a) of no. 1 of article 29 of the Regulation on Tax Arbitration Proceedings] which establishes that "the tax administration is obliged, in case of total or partial admissibility of a complaint, judicial challenge or appeal in favor of the taxpayer, to immediate and full restoration of the legality of the act or situation that is the object of the litigation, including the payment of compensatory interest, if appropriate, from the expiry of the period of execution of the decision."
Although article 2, no. 1, subparagraphs a) and b), of the Regulation on Tax Arbitration Proceedings uses the expression "declaration of illegality" to define the competence of the arbitration tribunals operating in CAAD, making no reference to condemnatory decisions, it should be understood that its competencies include the powers that, in judicial challenge proceedings, are attributed to tax courts, and this is the interpretation that is in harmony with the sense of the legislative authorization on which the Government based itself to approve the Regulation on Tax Arbitration Proceedings, in which it is proclaimed, as the first guideline, that "the tax arbitration process must constitute an alternative procedural means to the judicial challenge proceedings and to the action for recognition of a right or legitimate interest in tax matters."
The judicial challenge proceedings, although essentially an annulment process of tax acts, admits the condemnation of the Tax Administration to the payment of compensatory interest, as is inferred from article 43, no. 1, of the General Tax Law, in which it is established that "compensatory interest is due when it is determined, in a gracious complaint or judicial challenge, that there was error attributable to the services from which results the payment of the tax debt in an amount superior to that legally due" and from article 61, no. 4 of the Code of Tax Procedure and Process (in the wording given by Law no. 55-A/2010, of 31 December, which corresponds to no. 2 in the original wording), which states that "if the decision recognizing the right to compensatory interest is judicial, the period for payment is counted from the beginning of the period of voluntary execution."
Thus, no. 5 of article 24 of the Regulation on Tax Arbitration Proceedings, when stating that "the payment of interest, regardless of its nature, is due in accordance with the terms provided for in the general tax law and in the Code of Tax Procedure and Process," should be understood as permitting the recognition of the right to compensatory interest in the arbitration proceedings.
It is therefore necessary to assess the request for reimbursement of the amount unduly paid, plus compensatory interest.
The collection of autonomous taxation was €125.362,41 and the Claimant did not deduct the amount of €4.607.428,18, relating to the application of SIFIDE.
No. 4 of article 4 of SIFIDE establishes that "expenses that, due to insufficient collection, cannot be deducted in the fiscal year in which they were incurred may be deducted up to the sixth immediate fiscal year."
Having already been a fiscal year subsequent to 2014 in which the amount of SIFIDE could have been deducted, which, not having been deducted in the fiscal year of 2014, carried forward to subsequent fiscal years, it is not possible to decide whether or not there is a right to reimbursement of the amount of €125.362,41, which was not deducted, with respect to the fiscal year of 2014, but may have been in the fiscal year of 2015, so that this is a matter that can only be assessed and decided in enforcement of the judgment.
With regard to compensatory interest, the substantive regime is regulated in article 43 of the General Tax Law, which establishes, as far as is relevant here, the following:
Article 43
Unddue Payment of Tax Obligation
1 – Compensatory interest is due when it is determined, in a gracious complaint or judicial challenge, that there was error attributable to the services from which results the payment of the tax debt in an amount superior to that legally due.
2 – It is also considered that there is error attributable to the services in cases in which, despite the assessment being made on the basis of the declaration of the taxpayer, the latter has followed, in its completion, generic guidance of the tax administration, duly published.
The illegality of the decision on the gracious complaint, in the part relating to the issue of deduction of SIFIDE from the collection of autonomous taxation, is attributable to the Tax Administration, which rejected it on its own initiative.
With respect to the self-assessment, which was carried out by the Claimant, the attribution of the error to the Tax and Customs Authority derives from the configuration of the computer system which was proven not to allow the deduction of SIFIDE from the IRC collection derived from autonomous taxation.
In fact, the obligation to complete the model 22 declaration without deducting the amount of fiscal benefits from the collection resulting from autonomous taxation is equivalent to generic guidance of the tax administration that the taxpayer comply with, by even greater reason since there is no alternative to such compliance.
Consequently, the Claimant has the right to compensatory interest, in accordance with articles 43, no. 1, of the General Tax Law, 61 of the Code of Tax Procedure and Process and 104, no. 6, of the IRC Code from 01-09-2015, the day following the deadline for reimbursement of tax provided for in no. 3 of this article 104 of the IRC Code.
Compensatory interest is due until reimbursement is made or until the amount of €125.362,41 has already been deducted, if that has occurred.
Compensatory interest is due at the supplementary legal rate, in accordance with articles 43, nos. 1, and 35, no. 10 of the General Tax Law, article 24, no. 1, of the Regulation on Tax Arbitration Proceedings, article 61, nos. 3 and 4, of the Code of Tax Procedure and Process, article 559 of the Civil Code and Administrative Order no. 291/2003, of 8 April (or such other or others as may alter the legal rate).
5. Decision
In accordance with the above, the members of this Arbitration Tribunal agree to:
a) Rule the request for arbitral pronouncement well-founded as to the declaration of illegality of the non-deduction of the amount of SIFIDE from the collection resulting from autonomous taxation and annul the self-assessment, in the respective part, as well as the decision on the gracious complaint;
b) Rule the requests for reimbursement of amount and compensatory interest as well-founded, in the terms defined in point 4 of this decision.
6. Value of the Case
In accordance with the provisions of article 305, no. 2, of the Code of Civil Procedure and 97-A, no. 1, subparagraph a), of the Code of Tax Procedure and Process and 3, no. 2, of the Regulation of Costs in Tax Arbitration Proceedings, the value of the case is set at €125.362,41.
7. Costs
In accordance with article 22, no. 4, of the Regulation on Tax Arbitration Proceedings, the amount of costs is set at €3.060,00, in accordance with Table I attached to the Regulation of Costs in Tax Arbitration Proceedings, to be borne by the Tax Authority.
Lisbon, 28-06-2017
The Arbitrators
(Jorge Manuel Lopes de Sousa)
(Ana Teixeira de Sousa)
(José Manuel Aurélio dos Santos)
(dissenting as set forth in attached declaration)
Dissenting, in accordance with the vote that follows and is integral to this decision)
I do not agree with the orientation that resulted in the majority decision for the reasons contained in Arbitral Decision Case no.: 59/2017-T, the content of which I now reiterate, albeit in summary form.
Dissenting Opinion
When I expressed my opinion on the matter under observation Case no. 59/2017-T I perceived that (matter "SIFIDE - Autonomous Taxation") opinions converge and diverge within CAAD itself, and are not consensual. In my humble opinion, I see an excellent approach by the parties that interpret differently the problematic nature of autonomous taxation.
My reasoning is based not only on the calculation of Income Tax, but also on the interpretation of Article 88 IRC Autonomous Taxation.
Autonomous taxation emerged in the year 2000, with the intention of combating fraud and tax evasion, and has been widely used, seeking to encompass an increasingly broad set of categories, especially in times of economic crisis.
Determined independently of IRC and municipal surtax – the tax owed in each fiscal year, autonomous taxation is not directly related to the obtaining of positive results, that is, subject to taxation under IRC.
In practical terms, this tax aims to tax charges or expenses incurred by companies that, typically, would be used or would have a remuneration component in their origin.
Structure of the Calculation of Income Tax
(The need to explain the form of calculation of the tax is due, in my opinion, to the fact of perceiving that there is a total lack of understanding of this procedure which undermines the "decision" on what effectively should be deducted from the tax collection or not.
In the formula for calculating Taxable Profit, taxable matter, deductions from collection and subsequently autonomous taxation I usually divide this process into phases of Model 22 of IRC:
Phase 1: Table 07 Determination of Taxable Profit:
Determination of Taxable Profit or Loss for tax purposes as a function of the Net Result of the Company (Accounting Result)
Phase 2: Table 8 - Rate Regime
Rate to Apply
Phase 3 - Table 9 - Determination of Taxable Matter
Tax Loss / Taxable Profit
Deductions for determination of taxable matter (Tax Losses/Fiscal Benefits)
Phase 4 - Calculation of Tax - Deductions from Total Collection (1)
Deductions from collection
l) International legal double taxation (DTJI - art. 91) Field 353
m) International economic double taxation (art. 91-A) Field 354
n) Fiscal benefits Field 355
o) Special advance payment on account (art. 93)
Determination of IRC
Phase 5 - Calculation of Tax - Deductions from Total Collection (2)
· Withholdings at source
· Payment on account
· Additional payments on account
IRC Payable / IRC to be recovered
Phase 6 - Calculation of Tax - Deductions from Total Collection (3) Total Payable / Recoverable
....
Autonomous Taxation
...
Total Payable/Total Recoverable (Tax)
The integration of autonomous taxation into the IRC Code (and IRS) conferred a dualistic nature, in certain aspects, to the normative system of this tax, which was embodied, in particular, in the context of subparagraph a) of no. 1 of article 90 of the IRC Code, in separate determinations of the respective collections, due to the fact that they obeyed different rules.
References to the basis of opinion:
"...autonomous taxation is nothing more than an auxiliary mechanism of the central axis of IRC,
which is to tax profits (…)" case no. 80/2014-T - CAAD
"Although formally included in the IRC Code and the amount that allows it to collect is assessed in its scope and in the title of IRC, the rule in question respects an imposition that is materially distinct from taxation in this tax, (….). Indeed, we are faced with autonomous taxation, as the letter of the rule itself says. And that makes all the difference.(…)" Case no. 2014/2010
Case no. 785/2015-T
…"«It should also be noted the new rule of no. 21 added to article 88 of the IRC Code by law no. 7-A/2016 of 30 March, regardless of whether or not it is truly interpretative, in no way alters this conclusion, as there is established, with respect to the form of assessment of autonomous taxation, that it "is carried out in accordance with the terms provided for in article 89° and is based on the values and rates resulting from the provisions of the preceding numbers."
Indeed, if it is true that this new rule comes to clarify how the amounts of autonomous taxation are calculated (which already resulted from the very text of the various provisions of article 88.9) and that competence lies with the taxpayer or the Tax Administration, in accordance with article 89°, it is also clear that it does not negate the need to use the procedure provided for in no. 1 of article 90.9, particularly in the cases provided for in its subparagraph c) where assessment is the responsibility of the Tax and Customs Authority, with "as its basis the elements available to the tax administration," which it appears unquestionable will encompass the possibility of assessing on the basis of autonomous taxation, if the Tax and Customs Authority has elements that prove its prerequisites.
Therefore, both before and after Law no. 7-A/2016, of 30 March, article 90.9, no. 1, of the IRC Code is applicable, in the terms referred to, to the assessment of autonomous taxation, that is, with determination in an autonomous and distinct manner from that processed in accordance with the cited article 90.°"
Case no.: 59/2017-T
Constitutional Court Decision no. 310/12, of 20 June:
"(...) Contrary to what happens in the taxation of income under IRS and IRC, in which the totality of income earned in a given year is taxed (which implies that only at the end of it can the tax rate be determined, as well as the bracket in which the taxpayer falls), in this case each expense incurred is taxed, considered in itself, and subject to a certain rate, with autonomous taxation being determined independently of IRC that is due in each fiscal year, because it is not directly related to the obtaining of a positive result, and therefore subject to taxation
This last paragraph is also in the sense of my opinion, since the implementation of autonomous taxation, as an "appendix" to IRC there exists the anti-abuse function of autonomous taxation of IRC.
It is my opinion that in accordance with no. 21 of Article 88 of the IRC Code the fiscal benefits (SIFIDE), are not deductible from the amount of autonomous taxation.
GIVEN THE FOREGOING IT IS MORE THAN EVIDENT THAT THE CLAIMANT HAS NO MERIT IN ITS CLAIM, THAT IS, THE FISCAL BENEFITS, IN THIS CASE, SIFIDE SHOULD NOT BE DEDUCTIBLE FROM THE COLLECTION PRODUCED BY AUTONOMOUS TAXATION.
José Manuel Aurélio dos Santos
Economist (…)
[Text prepared by computer, in accordance with article 131, number 5 of the Code of Civil Procedure (CPC), applicable by referral from article 29, no. 1, subparagraph e) of the Regulation on Tax Arbitration Proceedings. The wording of this decision follows the old orthography.]
[1] Article 6 of article 87 of the IRC Code was repealed by Law no. 55/2013, of 8 August, which has no relevance for this purpose of demonstrating that outside the scope of autonomous taxation there were and are partial IRC calculations based on special rates applicable to certain taxable matters.
[2] This is, moreover, the position of the Tax and Customs Authority which states that there are "two distinct calculations which, although processed, in accordance with the same legal basis – subparagraph a) of no. 1 of article 90 of the IRC Code - and in the declarations referred to in articles 120 and 122 of the same code, are carried out on the basis of different parameters, since each is materialized in the application of its own rates, provided for in articles 87 or 88 of the IRC Code, to the respective taxable matters determined equally in accordance with its own rules" (article 27 of the Response).
[3] Currently only in relation to some autonomous taxation can one find the nature of anti-abuse rules, since, as CASALTA NABAIS teaches, Tax Law, 7th edition, page 543, "it is, however, clear that the expansion and aggravation of which such autonomous taxation currently has a clear purpose of obtaining more tax revenues."
[4] In this sense, one may see the decision of the Supreme Administrative Court of 15-11-2000, case no. 025446, published in the Bulletin of the Ministry of Justice no. 501, pages 150-153, in which extensive case law of the Supreme Administrative Court and the Supreme Court of Justice is cited.
This Bulletin of the Ministry of Justice is available at:
http://www.gddc.pt/actividade-editorial/pdfs-publicacoes/BMJ501/501_Dir_Fiscal_a.pdf
[5] BAPTISTA MACHADO, Introduction to Law and Legitimizing Discourse, page 186.
[6] This text is available at http://info.portaldasfinancas.gov.pt/NR/rdonlyres/70E81137-189A-440E-AF11-88B4A6CC1C9A/0/Notas_Previas_IRC_20092011.pdf.
Moreover, for several years now only a minority of taxpayers have paid IRC based on the taxable profit of the respective fiscal year, as can be seen in the statistical documents published at http://info.portaldasfinancas.gov.pt/pt/dgci/divulgacao/estatisticas/estatisticas_ir/:
– 29% in the taxation period of 2010, in which approximately 76% of taxpayers made IRC payments by means of Special Advance Payment on Account, or other positive components of the tax (Autonomous Taxation, Municipal Surtax, State Surtax, IRC from prior taxation periods, etc.);
– 31% in the taxation period of 2009, in which 77% of taxpayers made IRC payments by means of Special Advance Payment on Account, Autonomous Taxation and IRC from prior fiscal years;
– 34% in the taxation period of 2008, in which 79% of taxpayers made IRC payments by means of Special Advance Payment on Account, Autonomous Taxation and IRC from prior fiscal years;
– 36% in the taxation period of 2007, in which 80% of taxpayers made IRC payments by means of Special Advance Payment on Account, Autonomous Taxation and IRC from prior fiscal years.
[7] OLIVEIRA ASCENSÃO, Law – Introduction and General Theory, page 260.
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