CAAD Ruling on SGPS Financial Charges Deductibility Under IRC and Circular 7/2004

ARBITRAL DECISION

The arbitrators José Baeta de Queiroz (arbitrator president), Hélder Faustino and Manuel Pires (arbitrators members), designated by the Deontological Council of CAAD to constitute the Arbitral Tribunal established on 09-12-2015, hereby agree on the following:

I. Report

1. A... – Sociedade Gestora de Participações Sociais, S.A. (hereinafter referred to as "Claimant"), legal entity no. ..., with registered office at ... no. ..., ..., in Torres Vedras, having been notified of the tax assessment acts for Corporate Income Tax (IRC) relating to the tax period of 2011, formalized by the assessment documents no. 2015..., statement of account adjustment no. 2015... and compensation no. 2015..., in the total amount of €194,874.31, has filed, under paragraph a) of article 2(1) and paragraph a) of article 10(1) of Decree-Law no. 10/2011, of 20 January (Legal Framework for Tax Arbitration, hereinafter RJAT), a request for arbitral decision with a view to the annulment of those acts.

2. The Respondent is the Tax and Customs Authority (AT).

3. The claim that is the subject of the request for arbitral decision consists in the annulment of those acts, together with the condemnation of AT to reimburse the tax improperly paid and, as well, to the payment of compensation for guarantee improperly provided.

3.1. The Claimant petitions:

a) the declaration of illegality of the additional IRC assessment resulting from the statement of account adjustment no. 2015... relating to the tax period of 2011 and consequent annulment of the tax and compensatory interest owed, in the amount of €194,874.31, improperly assessed by AT; or

b) the partial annulment of the additional IRC assessment for the period of 2011, that is, that only the tax applicable to the taxable profit of the Claimant corresponding to the increase relating to non-deductible financial charges under article 32(2) of the Tax Benefits Statute (EBF) be considered, in the amount of €176,319.92, with the corresponding annulment of the tax in the amounts of €121,046.02, relating to IRC, €7,262.76, relating to municipal levy and €14,445.93, relating to compensatory interest; and

c) the condemnation of AT to reimburse the tax improperly paid;

d) the condemnation of AT to pay compensation for guarantee improperly provided.

1. The request for constitution of the Arbitral Tribunal was accepted by the President of CAAD and automatically notified to AT.

4.1. The Claimant did not proceed with the appointment of an arbitrator, therefore, under the provisions of paragraph a) of article 6(2) and paragraph b) of article 11(1) of RJAT, the President of the Deontological Council appointed the arbitrators José Baeta de Queiroz, Manuel Pires and Mariana Gouveia de Oliveira as arbitrators of the collective Arbitral Tribunal, who communicated acceptance of the appointment within the applicable period.

4.2. On 23-11-2015, the parties were notified of the appointment of the arbitrators, having raised no objection.

4.2. In accordance with the provisions of paragraph c) of article 11(1) of RJAT, the collective Arbitral Tribunal was constituted on 09-12-2015.

4.3. Subsequently, arbitrator Mariana Gouveia de Oliveira resigned from the functions of adjunct arbitrator in the aforementioned process, and the President of the Deontological Council of CAAD determined, on 10-12-2015, her replacement by arbitrator Hélder Faustino.

4.4. In these terms, the Arbitral Tribunal is properly constituted to hear and decide the subject matter of the case.

1. To substantiate the request for arbitral decision, the Claimant alleges, in summary, the following:

a) In compliance with Service Order no. OI2015..., of 13-05-2015, of partial scope, an internal inspection procedure was carried out on the elements collected under project 2014/.../... – SGPS – Holding Companies, related to controlling compliance with the provisions of article 32(2) of EBF regarding financial charges, among others.

b) As referred to in the inspection report, AT disregarded certain financial charges, allegedly borne by the Claimant with the acquisition of equity interests capable of benefiting from the regime provided for in article 32(2) of EBF, in the wording in force at the time, having consequently increased the taxable profit for the tax period of 2011 by the amount of €660,504.01 (six hundred and sixty thousand, five hundred and four euros and one cent), with the consequent alteration of the taxable base declared by the Claimant.

c) The Claimant was notified of the IRC assessment statement no. 2015..., issued on 21-05-2015.

d) The Claimant does not agree with AT's decision for the following reasons:

i. AT concluded that there were corrections to taxable profit relating to non-deductible financial charges based on the methodology provided for in Circular no. 7/2004, of 30 March, from the IRC Services Directorate[1], which establishes "(…) in essence, a pro-rata allocation of remunerated liabilities to assets reflected in the balance sheet of (…) holding companies".

ii. AT presents not a single ground (of fact or law) that permits it to correct the financial charges in question, nor does it prove that the same were actually borne with the acquisition of equity interests of the Claimant.

iii. AT merely reproduces the arguments advanced in the course of the administrative procedure and other arguments of a purely useless nature for the case in question (e.g., the part relating to supplementary contributions).

iv. The question of non-deductible financial charges is, however, not a new issue and has been the subject of various case law (arbitral and otherwise), recognizing the illegality of the indirect method of determining these charges provided for in Circular no. 7/2004, of 30 March, as well as the unconstitutionality of this administrative guidance by violation of the principle of legality and the requirement of formal legislation.

v. Unconstitutionality which has already been confirmed and determined at a higher level by the Constitutional Court (e.g., the Decision no. 42/2014, Case no. 564/2014, of 09-01-2014).

1. AT submitted a reply, alleging, in summary, the following:

a) The Respondent understands that since article 32(2) of EBF does not establish which method should be used for purposes of allocating financial charges to equity interests, Circular no. 7/2004, of 30 March, intends merely to implement the law, determining the method and form of calculation of financial charges borne with the acquisition of equity interests.

b) Now, as referred to in Case no. 21/2012-T of the Arbitral Tribunal, regarding the illegality/unconstitutionality of Circular no. 7/2004, of 30 March, it is not evident "(…) in what way that administrative doctrine could contain true rules of incidence, of determination of tax rate and of assessment, thereby violating the principle of tax legality provided for in articles 103(2) and (3) of CRP.".

c) AT further contends that it is not Circular no. 7/2004, of 30 March that creates rules of incidence, but it is the law itself, interpreted as stated above, that excludes deductibility, for purposes of determining the profit of the period in which they are incurred, of financial charges borne with financing linked to the acquisition of equity interests sold and which realize, albeit potentially, capital gains excluded from taxation.

d) In this measure, the interpretation contained in Circular no. 7/2004, of 30 March is in accordance with the letter of the law, insofar as it merely undertakes the discovery of its most precise meaning, in respect, moreover, of the general theory of legal interpretation and the normative framework that shapes it.

e) Thus, Circular no. 7/2004, of 30 March did not alter or distort the legal provision of article 32(2) of EBF, but merely standardized the interpretation and application of the norm, in the adequate defense of public interest and respect for the rights and interests of taxpayers cf. articles 266 of the Constitution of the Portuguese Republic (CRP) and 55 of the General Tax Law (LGT).

f) Furthermore, the explanation in the circular of the method to be used contributes to the effective realization of the extra-fiscal purposes that presided over its creation and to prevent taxpayers from using the normative to pursue purposes other than those envisaged in the law.

g) In the concrete case, the Claimant presented no alternative method to Circular no. 7/2004, of 30 March, within the scope of the diligences in the course of the inspection procedure, having moreover not exercised the right to a hearing.

h) As results from the inspection procedure, the disregard of financial charges for purposes of determining taxable profit, enshrined in the provisions of article 32(2) of EBF, "(…) constitutes a corollary of the principle of indispensability of costs, according to which fiscal deduction is conditioned by its connection with the obtaining of income subject to tax or indispensable for the maintenance of the source of production.".

i) In fact, as stated in the arbitral decision, case no. 14/2011-T, "(…) it is strictly in relation to the entity whose costs are under consideration, having regard to the business activity it develops, that it is important to assess the tax deductibility of financial charges. This fiscal deductibility presupposes, then, that the costs incurred with financial charges have a causal connection with the business activity developed, especially that they serve the development of the activity of the company owing them.".

j) In conclusion, the use of the allocation method used by Circular no. 7/2004, of 30 March aims at taxation as close as possible to real profit, with no violation whatsoever of the constitutional principle of taxation by real profit.

1. As the production of evidence was not requested, it was decided to dispense with the meeting provided for in article 18 of RJAT, and 09-06-2016 was set as the deadline for issuing the arbitral decision.

2. The parties submitted written pleadings.

II. Preliminary Rulings

9.1. The parties have legal personality and capacity, are duly qualified and are properly represented (articles 4 and article 10(2) of RJAT and article 1 of Ordinance no. 112-A/2011, of 22 March).

9.2. The Arbitral Tribunal is competent and properly constituted.

9.3. The case does not suffer from any nullities.

9.4. No other circumstances exist that would prevent the tribunal from hearing the merits of the case.

III. Merits

III.1. Factual Matters

1. Established Facts

10.1. With relevance for the assessment and decision of the issues raised, the following facts are established and proven:

a) The Claimant is a holding company;

b) On 31-12-2011, the Claimant held the following financial interests:

i. B…, Lda.;

ii. C…, SARL;

iii. D…, Lda.;

iv. E… – Construction, Lda.;

v. F…, Lda.;

vi. G…;

vii. H…, Lda.;

viii. I…, S.A.;

ix. J…, S.A.;

x. K… – Real Estate, Lda.;

c) L… AS

d) In 2011, the Claimant had financial costs totaling €1,718,550.04, which resulted from loans obtained from financial institutions, namely: M…, S.A.; N…, S.A. and O…, S.A.;

e) In 2011, the Claimant granted various loans to group companies in the amount of €25,078,520.16;

f) The Claimant was subject to an inspection action, which had exclusively as its purpose and origin the analysis of elements collected under project .../EEP/... – SGPS, related to controlling compliance with the provisions of article 32(2) of EBF regarding financial charges, among others;

g) In the course of this inspection action, a single correction was made to the taxable base for purposes of Corporate Income Tax (IRC), which consisted in the increase of the amount of €660,504.01, as title of non-accepted financial charges;

h) The correction in question was made on the basis of Circular no. 7/2004, of 30 March (cf. point III.2.2.1, page 12 of AT's Inspection Report and Doc. no. 2 attached to the request for arbitral decision);

i) The Claimant was notified of the IRC assessment statement no. 2015..., the statement of account adjustment no. 2015... and the compensation no. 2015..., in the total amount of €194,874.31, the payment deadline of which was 27-07-2015;

j) On 29-08-2015, the Claimant submitted the request for arbitral decision that gave rise to the present case.

10.2. Factual Foundation

The proven facts were based on documents attached to the request for arbitral decision and in the administrative process, with no controversy regarding them.

10.3. There are no other facts with relevance for assessment of the merits of the case that have not been proven.

III.2. Legal Matters

On the Merits

The central issue to be decided concerns whether or not the determination of financial charges through the method provided for in point 7 of Circular no. 7/2004, of 30 March is illegal.

Namely:

According to the provisions of article 32(2) of EBF then in force[2], "the capital gains and losses realized by holding companies in respect of equity interests of which they are holders, provided they have been held for a period of not less than one year, and, as well, the financial charges borne with their acquisition do not concur in the formation of taxable profit of these companies." [emphasis in original].

In the absence of a method of determining these charges expressly defined in EBF (or in the IRC Code), Circular no. 7/2014, of 30 March, came to sanction the understanding of the IRC Services Directorate regarding the methodology to adopt for purposes of determining the non-deductible financial charges by virtue of the provisions of article 32(2) of EBF.

Generically, the methodology provided for in the said Circular establishes a proportional allocation of remunerated liabilities reflected in the balance sheet of a holding company to the assets held by these companies, thus not taking into account the concrete reality of the companies that fall within the scope of the provisions of article 32(2) of EBF, nor the transaction that may have originated the holding of the equity interests.

Now, in light of this method of determination, non-deductible financial charges are allocated to all equity interests held by a holding company, even though their respective holding does not result from an actual acquisition, thus having no adherence whatsoever with the rule of incidence provided for in article 32(2) of EBF.

In fact, the norm in question has implicit a real allocation between the assets and liabilities in question, and the charges borne with the acquisition of equity interests.

According to the IRC Services Directorate, the choice of the methodology in question is justified by the difficulty in using a direct or specific allocation method and, as well, by the fact that the direct or specific allocation method could lead to manipulations.

In this sense, and taking into account the supposed difficulties that would arise from the use of a direct allocation method of financial charges to equity interests held by holding companies, we could be led to consider Circular no. 7/2004, of March, as the result of an interpretive exercise of the norm contained in article 32(2) of EBF undertaken by the IRC Services Directorate.

However, and precisely on the disputed matter, the Arbitral Tribunal[3] concluded that "(…) the definition of the assumptions of taxation is a matter subject to the principle of legality, by virtue of the provisions of article 103(2) of CRP which establishes that 'taxes are created by law, which determines the incidence, the tax rate, tax benefits and guarantees of taxpayers'." [emphasis in original].

That Arbitral Tribunal adds that "It is thus clear that the norms relating to the assessment of taxes, namely those that define incidence and tax benefits, are subordinated to the principle of legality, being consequently excluded the possibility of, through administrative means, creating norms that result in an actual burden on taxpayers." [emphasis in original].

It is concluded, therefore, that it is not permitted to create a methodology for allocating non-deductible financial charges under article 32(2) of EBF by way of an administrative instruction, given its subsumption to the principle of legality provided for in article 8 of LGT.

This Arbitral Tribunal understands that AT cannot, in any case, by means of a supposed act of internal interpretation of the law, impose a method that determines which financial charges are non-deductible under article 32(2) of EBF.

As is, moreover, well known, AT's interpretations are not binding on taxpayers[4], insofar as the Portuguese legal system does not consider generic guidance issued by AT as a source of law.

Given the absence of legislation that provides for the production of external legal effects of these acts, their binding character is merely internal.[5]

On the other hand, and as stated previously, the methodology for calculating financial charges associated with the acquisition of equity interests provided for in Circular no. 7/2004, of 30 March is based on a formula that does not take into account the conditions relating to the concrete case and does not attend to the reasons that may lead the taxpayer to be willing to incur the burden of demonstrating that, given the circumstances of the case, the indebtedness was due to other investments than the acquisition of equity interests.

In practice, the blind application of the formula contained in Circular no. 7/2004, of 30 March by AT could constitute an irrebuttable presumption that the financial charges determined are always borne with the acquisition of equity interests.

Now, the methodology provided for in Circular no. 7/2004, of 30 March does not provide the taxpayer with the opportunity to demonstrate whether, on the one hand, the financing obtained from which result the financial charges borne is prior or subsequent to the acquisition of equity interests that fall within the scope of the exemption from taxation of capital gains provided for in article 32 of EBF or, on the other, whether the equity interests considered were obtained through acquisition or through other transactions which, by their nature, exclude the existence of any financing associated with their obtaining.

In this respect, reference may also be made to the Decision of the Central Administrative Court of the North, of 15-01-2015, handed down in case no. 009046/09.0BEPRT[6], according to which it is categorically rejected that the method of allocating financial charges to equity interests followed in Circular no. 7/2004, of 30 March is in accordance with the provisions of article 32(2) of EBF.

Namely:

It is stated in said Decision that "The fact that in its methodology it used the criteria recommended in circular no. 7/2004, of 30 March, in particular its points 7 and 8 does not save the legality of the operation, since the criteria and assumptions of allocation of the remunerated liabilities of holding companies manifestly exceed the content of article 32(2) of EBF creating presumptions and proportional calculations that the legislator manifestly did not assume nor consent to." [emphasis in original].

More, "If the legislator did not institute any criterion that permits distinguishing in the total financial costs of holding companies which are due to the purchase of equity interests and which were used for other purposes, the ATA could only operate within the scope of a method that respected direct or specific allocation, because only this would be compatible with the principle of legality and impartiality to which it is subject (…) and which results from the wording of article 32(2) EBF in excluding from the formation of taxable profit the financial charges borne with the acquisition of alienated equity interests." [emphasis in original].

The Arbitral Tribunal also (in the aforementioned Case no. 292/2015-T) had the opportunity to pronounce expressly on the question of the illegality of the determination of financial charges through the method provided for in point 7 of Circular no. 7/2014, of 30 March.

The Arbitral Tribunal understood that the "(…) content of the principle of legality is indicated in article 3 of the Code of Administrative Procedure of 1991, in force at the time the assessment was issued and subsidiarily applicable to the tax procedure by virtue of the provisions of paragraph c) of article 2 of LGT, having the positive formulation that 'public administration bodies must act in obedience to the law and to law, within the limits of the powers attributed to them and in accordance with the purposes for which such powers were conferred on them'.".

"In this article 3 of the CPA of 1991, the principle of legality ceased to have 'a merely negative formulation (as in the period of the Liberal State), to have a positive formulation, constituting the foundation, the criterion and the limit of all administrative action'.".

In fact, "'The law is not merely a limit on the action of the Administration: it is also the foundation of administrative action. This means that, nowadays, there is no power free for the Administration to do as it wishes, unless the law prohibits it; on the contrary, the rule applies that the Administration can only do what the law permits it to do'." [emphasis in original].

"Therefore, in the case in question, (…) 'intending the ATA to disregard the costs accounted for by the respondent on the basis of the violation of article 32(2) of EBF, should demonstrate the assumptions of its right to taxation, that is, should prove that such costs were not legally deductible either because losses were realized with the onerous transfer of equity interests held for less than one year, or because financial charges were borne and accounted for with their acquisition'. In truth, it was this direct method that should have been used, since the Tax and Customs Authority cannot make use of an indirect method to determine the taxable base of the Claimant without the legal requirements being met that the law makes dependent on its use, provided for in articles 85 and 87 of LGT, and cannot use criteria for quantifying the taxable base not provided for in law (article 90 of LGT)." [emphasis in original].

The Arbitral Tribunal concludes that "(…) in determining the non-deductibility of financial charges, the Tax and Customs Authority is carrying out an activity of a nature unfavorable to the taxpayer, therefore it is incumbent upon it the burden of proof of the facts it invokes to support its action, namely, when opting for the use of indirect method of determining the taxable base, to prove that some or some of the legal assumptions of its application, indicated in article 87 of LGT, were present, as results from article 74(3) of LGT." [emphasis in original].

If not concretely proven facts that imply recourse to indirect methods, indirect methods cannot be used to determine the taxable base, insofar as these can only be used when it is demonstrated that the use of direct methods is not viable, as provided for in article 85(1) of LGT.[7]

Therefore "The 'indirect allocation' created by the Tax and Customs Authority through Circular no. 7/2004 is a mere fiction, based on presumptions whose foundation is not explained in it, to lead to the conclusion that there was an allocation (necessarily direct) of financing to the acquisition of equity interests without ascertaining whether it occurred or not and to what extent." [emphasis in original].

In conclusion, this Arbitral Tribunal understands that the administratively created formula by AT constitutes a method that, when applied mandatorily, deviates from the objective provided for in article 32(2) of EBF.

In fact, by superimposing the method provided for in Circular no. 7/2004, of 30 March, AT violated the principle of legality, as "(…) a principle that implements the rule of law which expresses the legal subordination of public administration (…)".[8]

It is thus concluded that the challenged act suffers from a defect of violation of law, for not having observed the regime provided for in article 32(2) of EBF and having infringed the principle of legality, in both its formal aspect (article 8(1) of LGT) and procedural aspect (article 55 of LGT).

In effect, this prejudices the assessment of the other issues raised by the Claimant, namely the alleged defect of unconstitutionality and, as well, the request made in the alternative, by having been declared the illegality of the assessments above identified, by a substantive defect that prevents the renewal of the acts, ensuring effective protection of the Claimant's rights, in accordance with article 124 of CPPT.[9]

On Compensation for Damages Resulting from the Provision of a Guarantee

The Claimant constituted, by public deed of 16-09-2015, a mortgage in favor of the Public Treasury / AT / Tax Service of … of the property constituted by the autonomous fraction identified by the letter C, inscribed in the matrix of the parish of …, municipality of Torres Vedras, under the number …, with the property tax value of €831,265.75, intended to suspend the execution of the aforementioned and now impugned additional assessment, in the amount of €195,720.09 (Docs. no. 13 and no. 14 attached to the request for arbitral decision).

According to José Maria Fernandes Pires (Coordinator), Gonçalo Bulcão, José Ramos Vidal, Maria João Menezes, in annotation to article 53 of LGT, "There are three constitutive elements of the right to compensation for undue guarantee:

a. First, a bank guarantee or equivalent has been provided in tax enforcement;

b. Second, the passive subject has borne costs with the provision or maintenance of the guarantee. The objective of this norm is exactly the return to the taxpayer of all costs borne with the provision or maintenance of the guarantee that proved to be undue, therefore it is essential to the constitution of the right that such costs have been effectively borne;

c. Third, it has been ascertained that the tax is undue by having been annulled totally or partially the assessment that gave rise to it. In this case two distinct circumstances may still occur:

i. In cases where the annulment of the assessment results from error of the tax administration itself, the right to compensation is constituted from the date of provision of the undue guarantee;

ii. In the remaining cases, namely when the error is the responsibility of the passive subject, the right to compensation is only constituted after three years have elapsed from the constitution of the guarantee.".[10]

The assessment in question suffers from illegality attributable to AT: the passive subject will obtain success in the impugnation and the ground for annulment is not attributable to it.

Being public and notorious that by the constitution of the guarantee, the Claimant bore and continues to bear charges for its maintenance, the requirements that confer on it the right to compensation under the provisions of article 53 of LGT are recognized as being met.

IV. Decision

In these terms, this Arbitral Tribunal agrees, by majority, to:

a) Judge the claim filed by the Claimant as well-founded, declaring the illegality and annulling the act of additional IRC assessment resulting from the statement of account adjustment no. 2015... relating to the tax period of 2011 (with the consequent right to reimbursement of the amount improperly paid);

b) Judge the guarantee provided in the course of the tax enforcement process no. ...2015... as undue;

c) Judge the claim for compensation for damages resulting from the provision, now judged undue, of that guarantee as well-founded;

d) Condemn AT to pay compensation to the Claimant, according to the terms and within the limits provided for in article 53 of LGT and to be determined in execution of judgment, resulting from the well-foundedness of the claim to which the preceding subparagraphs refer; and

e) Condemn AT to the costs of this process.

V. Value of the Case

In accordance with the provisions of article 306(2) and article 297(2), both of the Code of Civil Procedure, of paragraph a) of article 97-A(1) of the Code of Tax Procedure and Process and of article 3(2) of the Regulations of Costs in Tax Arbitration Proceedings, the value of the case is set at €194,874.31 (one hundred and ninety-four thousand, eight hundred and seventy-four euros and thirty-one cents).

VI. Costs

In accordance with the provisions of article 22(4), article 12(2), both of RJAT, article 2, article 3(1) and articles 4(1) to (4) of the Regulations of Costs in Tax Arbitration Proceedings, as well as in Table I attached to this regulation, the total amount of costs is set at €3,672.00 (three thousand, six hundred and seventy-two euros).

Lisbon, 9 June 2016.

The arbitrators,

José Baeta de Queiroz

(Arbitrator President)

Hélder Faustino (Rapporteur)

(Arbitrator Member)

Manuel Pires

(Arbitrator Member – dissenting, as per the opinion that follows as an integral part of this decision)

Text prepared by computer, in accordance with article 131(5) of CPC, applicable by reference of paragraph e) of article 29(1) of RJAT. The wording of this decision is governed by the spelling prior to the Spelling Agreement of 1990.

DISSENTING OPINION

I voted, as in Arbitral Case no. 663/2015-T, although in what is applicable, not agreeing with the recognition of the Tribunal's competence regarding the possible reimbursement of the tax, given the provisions of the law (cf. Arbitral Decision in case no. 244/2013-T). I further voted, and without disregard for the type of case in question, understanding it to be necessary to deepen the analysis of Circular no. 7/2004, of 30 March, of the DSIRC (cf. arbitral decision in case 258/2015-T), of the issues raised by it, taking into account in particular the quantitative or valuation aspect of the objective assumption of taxation and the means for its determination, as well as the consequences deriving from that deepening, including the invocation of constitutional principles. Given the interpretive and guiding character of the circular with respect to the application of article 32(2) of EBF, contributing to the security derived from standardization – the article silent as to the method applicable in the determination of the charges referred to in it –, it is necessary to correctly interpret the provision in question, attending to its ratio essendi (avoiding double tax relief and even more or less refined schemes to avoid tax), resorting, if necessary, to extensive interpretation – today accepted, with the departure from outdated approaches such as merely literal interpretation, even in the domain of the essential elements of the tax –, interpretive work that leads to the departure from the exclusivity of direct or specific allocation. It is also important to analyze the fulfillment of the burden of proof, a burden that cannot or could not be underestimated or reversed, even in the case of reaching or having reached the conclusion that the said circular is against the law.

Manuel Pires

[1] Available at http://info.portaldasfinancas.gov.pt/NR/rdonlyres/25504FA8-CD27-4EA3-A238-E67E6A99ED75/0/circular_7-2004_de_30_de_marco_da_dsirc.pdf.

[2] Repealed by Law no. 83-C/2013, of 31 December.

[3] Case no. 292/2015-T, of 11-11-2015, available at https://caad.org.pt/tributario/decisoes/.

[4] Cf. the provisions of article 68-A(1) of LGT.

[5] In this sense, José Maria Fernandes Pires (Coordinator), Gonçalo Bulcão, José Ramos Vidal, Maria João Menezes, "General Tax Law Commented and Annotated", Almedina, 2015, page 782 and António Lima Guerreiro, "General Tax Law Annotated", Editora Rei dos Livros, 2001, page 314, for whom "(…) generic guidance (…) is not generally a source of law, not binding taxpayers nor courts, not having the value of authentic interpretation.".

[6] Available at www.dgsi.pt.

[7] In this sense, José Maria Fernandes Pires (Coordinator), Gonçalo Bulcão, José Ramos Vidal, Maria João Menezes, "General Tax Law Commented and Annotated", Almedina, 2015, page 882.

[8] Cf. Marcelo Rebelo de Sousa, André Salgado de Matos, "Administrative Law General - Volume I - Introduction and Fundamental Principles", Dom Quixote, 2004, page 153 et seq.

[9] Subsidiarily applicable by virtue of the provisions of paragraph a) of article 29(1) of RJAT.

[10] Op. Cit., page 550.