Process: 72/2014-T

Date: July 23, 2014

Tax Type: Selo

Source: Original CAAD Decision

Summary

CAAD arbitration case 72/2014-T addresses a critical issue regarding Portuguese stamp tax (Imposto de Selo) under Verba 28 of the General Table, specifically concerning vertical property (propriedade vertical). Two taxpayers challenged stamp tax assessments on apartments and cellars within a single building registered as urban property article 585 in Lapa parish, Lisbon. The taxpayers, who held usufruct rights, contested assessments made under Item 28, which applies to properties exceeding €1 million taxable patrimonial value. The claimants argued that the Tax Authority (AT) improperly assessed stamp tax on individual apartments and cellars that were each valued substantially below €1 million for IMI purposes. They contended that each unit should be treated as an independent property, analogous to horizontal property (propriedade horizontal) autonomous fractions, particularly since each apartment had independent economic use and separate IMI valuations. The taxpayers also raised procedural violations, including lack of proper reasoning (violating Article 268(3) of the Portuguese Constitution and Article 77(1) of LGT) and absence of prior hearing as required by Article 60(1)(a) of LGT. The Tax Authority defended its position by arguing that vertical property constitutes a single property unit under Portuguese civil and tax law, unlike horizontal property where autonomous fractions are legally separate. The AT maintained that Article 2 of CIMI distinguishes between these property regimes, and no analogy could be applied. This CAAD case highlights fundamental questions about Portuguese tax law interpretation, the distinction between vertical and horizontal property regimes for stamp tax purposes, equality principles under Article 13 of the Constitution, and whether Item 28 taxation intended for luxury properties exceeding €1 million should apply to aggregated values of multiple modest residential units within a single building structure.

Full Decision

ARBITRAL DECISION

I – Report

  1. On 29.01.2014, A..., unmarried, of legal age, with tax identification number ..., holder of citizen card no. ..., issued by the Portuguese Republic, resident at Travessa …, Lisbon and B..., unmarried, of legal age, with tax identification number ..., holder of citizen card no. …, issued by the Portuguese Republic, resident at Travessa …, Lisbon, requested the CAAD to constitute an arbitral tribunal, pursuant to article 10 of Decree-Law no. 10/2011, of 20 January (Legal Framework for Arbitration in Tax Matters, hereinafter referred to only as RJAT), in which the Tax and Customs Authority is the Respondent, with a view to declaring the illegality and annulment of:

  • The acts of assessment of Stamp Tax, Item no. 28 of the respective General Table, relating to the year 2012 and concerning urban land registration article no. 585, parish of Lapa, dated 21.03.2013, which were notified to them.

  • The act of rejection of the gracious complaint filed, jointly, by the Claimants against the aforementioned assessments.

  1. The request to constitute the arbitral tribunal was accepted by the Honourable President of the CAAD and notified to the Tax and Customs Authority.

Pursuant to the terms and for the purposes of the provisions in article 6, paragraph 1 of the RJAT, by decision of the President of the Deontological Council, duly communicated to the parties, within the applicable legal periods, Dr. Marcolino Pisão Pedreiro was designated as arbitrator, who communicated to the Deontological Council and to the Centre for Administrative Arbitration his acceptance of the appointment, within the regularly applicable period.

The Arbitral Tribunal was constituted on 31.03.2014.

  1. The meeting provided for in article 18 of the RJAT took place on 21.05.2014, at 15:30 hours.

  2. The grounds presented by the Claimant in support of its claim are, briefly, as follows:

  • The acts of assessment suffer from lack of grounds, and should be annulled as a consequence of this formal defect, by violation of article 268, paragraph 3 of the Constitution of the Portuguese Republic and article 77, paragraph 1, of the LGT.

  • The authors only became aware of the tax assessments in question upon receipt of the collection notes attached to the case files, which refer only to the identification of each of the relevant apartments and cellars and their respective taxable patrimonial value, with as many stamp tax assessments as there are apartments and cellars of which they are usufructuaries, which shows that, at least initially, the AT understood the reality of the property in question.

  • The apartments and cellars which constitute the property in question were valued for IMI purposes individually and autonomously, and were assigned a value much inferior to 1 million euros.

  • It is not understood why, as the AT does not explain, it imposed through the contested assessments on each of those apartments and cellars a tax that should only apply if they had a taxable patrimonial value exceeding one million euros.

  • Additionally, in the examination of the gracious complaint filed by the present authors, set out in the act of rejection thereof, the facts and the law in question are not effectively analysed, and the AT's conduct remains unexplained.

  • Since the lack of grounds is equivalent to the adoption of grounds which, through obscurity, contradiction or insufficiency do not clarify, concretely, the motivation of the act in such a way as to permit its recipient to understand the volitional and cognitive process that determined the Administration.

  • The assessments are also tainted by the defect of lack of prior hearing, since the claimants were not heard at any moment prior to the Stamp Tax assessments, as imposed by article 60, paragraph 1, letter a), of the LGT, and should, as a consequence, be annulled.

  • The allegation made by the AT in the decision rejecting the complaint, that in this case there were involved binding powers, whereby hearing the individual would be futile, lacks grounds, inasmuch as the AT proceeded with an erroneous interpretation and application of the Law, which could have been stressed and explained in the course of the hearing, but was not possible, due to the violation of the right to be heard.

  • The new Item no. 28 of the General Table of Stamp Tax, introduced by Law no. 55-A/2012, of 29 October, in a context of profound economic and financial crisis, was aimed at those who, having contributive capacity manifested by the ownership of assets in an amount exceeding a certain value, should contribute equally, and even in an enhanced manner, commensurate with such capacity.

  • It was intended to create a specific taxation for holders of so-called "luxury homes", that is, for those with high incomes and/or assets, which makes it possible to conclude that this is the ratio, the spirit, of the Item in question.

  • The AT imposes on the Claimants a tax aimed at taxing assets deemed as luxury, presuming that such assets reflect an enhanced contributive capacity of the same authors for contributing to the adjustment effort, which does not occur in the present case, and there is no question of any "luxury home", since we are faced with a set of several houses, of independent use and which are intended for the dwelling of different families, whose value, both taxable and market value, is much inferior to 1 million euros.

  • When fixing the taxable patrimonial value of the property, the AT valued each of the apartments and each of the cellars individually and not the property as a whole, and following those various assessments summed the taxable patrimonial values fixed, and to each of the apartments and cellars was fixed its own taxable patrimonial value.

  • Having the legislator understood that each autonomous fraction should be treated as a property, in the present case, the same understanding must be applied in respect of each apartment and cellar of the building registered under article no. 585 of the parish of Lapa, given that, in material terms, the situation of the case is in all respects identical to that of a building for which horizontal property was constituted, and no reason is apparent for them to be treated differently.

  • Disparate understanding would imply the adoption of an interpretation of Item no. 28 of the General Table of Stamp Tax manifestly violative of the principle of equality, contained in article 13 of the Constitution.

  1. The ATA – Tax and Customs Administration, called upon to state its position, contested the Claimant's claim, defending itself by objection, and alleged, in summary, the following:

  • The situation of the Claimants' property literally falls within the provision of the item in question.

  • The Claimants are usufructuaries of a property under a regime of total or vertical ownership and from the notion of property in article 2 of the CIMI only autonomous fractions of properties under a horizontal property regime are considered as properties.

  • The present Claimants for purposes of IMI and also of stamp tax, by force of the wording of the said item, are not usufructuaries of 13 autonomous fractions, but rather of a single property.

  • What the present claimants intend is for the AT to consider, for purposes of assessment of the present tax, that there exists an analogy between the regime of total ownership and that of horizontal property, but the interpreter cannot equate these regimes, in accordance with the rule that concepts from other branches of law have the meaning in tax law that is attributed to them in those branches of law, as well as by virtue of the fact that there is no gap in the law.

  • The unity of the property in vertical ownership composed of various storeys or divisions is not affected by the fact that all or some of those storeys or divisions are susceptible to independent economic use.

  • The fact that the IMI was calculated based on the Taxable Patrimonial Value of each part of property with independent economic use does not equally affect the application of item 28, paragraph 1, of the General Table.

  • The legislator may subject to a distinct, and therefore discriminatory, tax legal framework properties in a horizontal property regime and vertical property regime, favouring the more legally advanced institute of horizontal property, without such discrimination necessarily having to be considered arbitrary.

  • Such discrimination may also be imposed by the need to impose coherence on the tax system.

  • It would be unconstitutional, as offensive of the principle of tax legality, the interpretation of item 28.1 of the General Table, in the sense that the patrimonial value on which its incidence depends is calculated by autonomous fractions that did not exist at the time of the assessment.

  1. The parties submitted written pleadings in which they maintained their positions.

  2. The tribunal is materially competent and is regularly constituted pursuant to the RJAT.

The parties have legal personality and capacity, are legitimate and are legally represented.

The proceeding is not affected by defects that would invalidate it.

II – The Relevant Matters of Fact

  1. The tribunal considers the following facts proven:

  2. The authors are registered usufructuaries in the land register, in equal shares, of a building located in Lapa, which was, in the year 2012, registered in the urban land register under article no. …, parish of ….

  3. This property was in 2012 divided into 14 parts susceptible to independent use, 13 of which were intended for dwelling, one of which at cellar level, and one part intended for storage and arrangement also in the cellar.

  4. Several of those apartments have been rented to third parties for dwelling for more than 30 years.

  5. When fixing the taxable patrimonial value of the property, the AT valued each of the apartments and each of the cellars individually and not the property as a whole, and following those various assessments summed the taxable patrimonial values fixed, for purposes of assigning the taxable patrimonial value to the property.

  6. To each of the parts susceptible to independent use was fixed its own taxable patrimonial value.

  7. None of the parts susceptible to independent use was fixed a taxable patrimonial value exceeding two hundred and sixty thousand euros.

  8. The property in question was not in 2012 constituted in horizontal property.

  9. The AT proceeded with the assessment of stamp tax object of the present proceeding, in relation to each of the parts susceptible to independent use that constitute the property.

  10. The Tax Administration made as many assessments as there are parts susceptible to independent use that constitute the property in question, with item no. 28 of the General Table of Stamp Tax applied to the taxable patrimonial value of each of them determined individually by the AT.

  11. The assessments in the proceeding amount to a total value of 16,726.00 €.

  12. The AT has proceeded annually, including for the year 2012, to assessments of Municipal Property Tax autonomously on each of the apartments or cellars that compose the building, applying to others the suspension of assessment provided for in article 118 of the IMI Code.

  13. In April, July and November 2013, the present authors were notified of the assessments of stamp tax, first, second and third instalments, by application of Item no. 28 of the General Table of Stamp Tax, with reference to the year 2012, on the 13 parts susceptible to independent use intended for dwelling.

  14. The Claimants were not notified, prior to the assessments, for purposes of exercising the right to be heard before the assessment.

  15. In the grounds of each of the assessments is contained the identification of the land register article and of the part susceptible to independent use in question, as well as the taxable patrimonial value of that part and also the taxable patrimonial value resulting from the sum of the taxable patrimonial values of all of its parts, also counting the year of the tax, the rate and also a reference to item 28.1 of the TGIS.

  16. In August 2013, the Claimants filed a gracious complaint of the assessments, with reference to the value of the first and second instalments, the only ones they had received by that date.

  17. The Claimants were notified of the draft rejection of the gracious complaint and, within the prescribed period, exercised their right to be heard.

  18. On 31 October 2013 the Authors were notified of the final rejection of that complaint.

  19. The Tribunal's conviction as to the decision of the matters of fact was grounded in the documents contained in the case file, as well as in the pleadings submitted, it being noted that the parties did not manifest any disagreement regarding the matters of fact alleged, the disagreement being confined to matters of law.

With respect to the composition of the property and its parts susceptible to independent use, the Tribunal's conviction was based on the analysis of the urban land register booklet of the property.

III – The Applicable Law

  1. As the impugning party has imputed various defects to the impugned tax acts, it is necessary to determine the order of knowledge of the same, the order in article 124 of the CPPT being to be observed, which is applicable by force of article 29, paragraph 1, letter a) of the RJAT (See Jorge Lopes de Sousa, Commentary on the Legal Framework for Tax Arbitration, in GUIDE TO TAX ARBITRATION, Coord. Nuno Villa-Lobos and Mónica Brito Vieira, 2013, Almedina, page 202).

The substantiation of any of the defects invoked by the claimant will lead to the annulment of the tax act. However, the defect of violation of law is the one that will lead to the "most stable or effective protection of the offended interests" inasmuch as its possible substantiation will prevent the renewal of the act, which does not occur with the annulment resulting from the other defects.

In accordance, the Tribunal will first examine the defect of violation of law.

  1. Item 28 of the General Table of Stamp Tax, in the wording at the time of the facts, provided that ownership of properties with residential use with TPV equal to or exceeding 1,000,000 euros is subject to stamp tax, in the following terms:

"28 – Ownership, usufruct or right of superficies of urban properties whose taxable patrimonial value contained in the register, pursuant to the Municipal Property Tax Code (CIMI), is equal to or exceeding 1,000,000 euros – on the taxable patrimonial value used for purposes of IMI:

28.1 – For property with residential use – 1%;

28.2 – For property, when the taxpayers who are not natural persons are resident in a country, territory or region subject to a clearly more favourable tax regime, contained in the list approved by order of the Minister of Finance – 7.5%".

  1. Article 67, paragraph 2 of the CIS establishes that "To matters not regulated in this Code regarding item no. 28 of the General Table, the provisions of the CIMI are applied, subsidiarily".

  2. Article 2, paragraph 4 of the Municipal Property Tax Code (hereinafter CIMI) provides that "For purposes of this tax, each autonomous fraction, under horizontal property regime, is considered as constituting a property".

It further establishes in article 92 of the same code:

"1 - To each building under horizontal property regime there corresponds only one entry in the register.

2 - In the generic description of the building mention must be made of the fact that it is under horizontal property regime.

3 - Each of the autonomous fractions is described in detail and individualized by the capital letter corresponding to it according to alphabetical order."

  1. For its part, article 12, paragraph 3 of this Code establishes that "Each storey or part of property susceptible to independent use is considered separately in the land register entry, which also distinguishes its respective taxable patrimonial value".[1]

Writing on this rule, J. Silvério Mateus and L. Corvelo de Freitas tell us: "An example that may illustrate this situation is the case of an urban property, not constituted in horizontal property and which is composed of various storeys. Legally this property constitutes a single unit (…).

However, as each of these units may be the object of lease or of any other use by the part of its respective holder, the register must evidence these units and taxable patrimonial value should be assigned to each of them".[2]

It appears, thus, that article 12, paragraph 3, is applicable to situations of properties in conditions of satisfying the objective requirements of submission to the horizontal property regime, provided for in article 1415 of the Civil Code, but in which there does not exist a constitutive deed.

  1. With respect to urban properties in conditions of satisfying the objective requirements of submission to the horizontal property regime, in substance the economic reality subject to taxation does not cease to be the same by the fact that the deed constituting horizontal property has, or has not, been executed.

And, from the perspective of the taxation of these realities, there is found in the CIMI no substantive difference in the treatment of a property based on the constitution of horizontal property.

  1. Effectively, in the regime of articles 38 et seq. of the CIMI which regulate the determination of the taxable patrimonial value of properties there is not detected substantive differentiation between properties constituted in horizontal property and properties with objective conditions for such, but in which submission to such a regime has not occurred[3], namely, such circumstances do not appear among the elements increasing or decreasing value provided for in the tables of articles 43, paragraph 2 of the code.

  2. The essential issue to be resolved in the present proceeding relates to the question of whether in properties with parts susceptible to independent use but not submitted to the horizontal property regime, the property will be considered as a unit for purposes of applying item 28 of the TGIS or whether its independent parts will be considered individually.

  3. In the first case, the value relevant for purposes of subsumption to item 28 shall be that resulting from the consideration of all of its parts and, in coherence, a single assessment should be made, only in relation to the property, and not as many assessments as there are parts or storeys susceptible to independent use.

  4. In the second case, the value to be considered for this purpose shall be that of each of the parts susceptible to independent use similar to what occurs with autonomous fractions of properties submitted to the horizontal property regime, and as many assessments as there are parts susceptible to independent use should be made, but only and solely in relation to parts susceptible to independent use whose value is equal to or exceeding 1,000,000 €.

  5. The AT made as many assessments as there are parts susceptible to independent use, a procedure which in our view does not harmonize with its own thesis that, in these cases, the reality aimed at by Item 28 of the TGIS is the property in its entirety and not each of its autonomous parts.

  6. The matter has already been examined in various arbitral decisions[4], all in the sense of considering that the value to be considered for this purpose shall be that of each of the parts susceptible to independent use similar to what occurs with autonomous fractions of properties submitted to the horizontal property regime, a solution which we consider correct.

  7. In a first interpretive moment of item 28 of the TGIS, the expression "urban property", in combination with article 2, paragraph 4 of the CIMI, which attributes the quality of urban property to autonomous fractions under horizontal property regime and apparently does not attribute it to parts susceptible to independent use, could point to the consideration of the property as a whole.

  8. But, even within the scope of the literal element, item 28 points in a different direction when it refers to "property with residential use", inasmuch as, in cases of properties susceptible to independent use, the use can only be determined fraction by fraction [5] and not globally, inasmuch as it may happen, and frequently happens in this type of property, that there are parts dedicated to dwelling and others dedicated to other purposes.

Thus, the legislator when referring to "property with residential use", with respect to properties with storeys or parts of property susceptible to independent use, could only have had in mind each of these fractions and not the property in its entirety.

  1. This reading of the literal element is in complete harmony with the provisions of the CIMI mentioned above, as well as with the other interpretive elements, as demonstrated in the various CAAD decisions on this matter and whose jurisprudence is followed without reservation.

  2. As was written in the decision handed down in proceeding 50/2013-T:

"the ratio legis underlying the rule of item 28 of the TGIS, introduced by Law no. 55-A/2012 of 29 October, and in obedience to the provision in article 9 of the Civil Code, according to which the interpretation of the legal norm should not be confined to the letter of the law, but should reconstruct from the texts and other interpretive elements the legislative thought, taking into account the unity of the legal system, the circumstances in which it was elaborated and the specific conditions of the time in which it is applied.

The legislator when introducing this legislative innovation considered as the determining element of contributive capacity urban properties, with residential use, of high value (luxury), more precisely, of value equal to or exceeding €1,000,000.00, on which it proceeded to impose a special rate of stamp tax, intending to introduce a principle of taxation on wealth externalized in the ownership, usufruct or right of superficies of urban properties of luxury with residential use. For this reason, the criterion was the application of the new rate to urban properties with residential use whose TPV is equal to or exceeding €1,000,000.00.

This very conclusion is drawn from the analysis of the discussion of draft law no. 96/XII in

the Assembly of the Republic, available for consultation in the Diary of the Assembly of the Republic, I series, no. 9/XII/2, of 11 October 2012.

The justification for the measure called "special tax on urban residential properties of highest value" is based on the invocation of the principles of social equity and fiscal justice, calling on holders of high-value properties intended for dwelling to contribute in a more intense manner, making the new special tax apply to "houses of value equal to or exceeding 1 million euros."

Clearly the legislator understood that this value, when attributed to a dwelling (house, autonomous fraction or storey with independent use) translates an above-average contributive capacity and, as such, is capable of determining a special contribution to ensure just distribution of the fiscal burden."

  1. The respondent further submits that "It would be unconstitutional, as offensive of the principle of tax legality, the interpretation of item 28.1 of the General Table, in the sense that the taxable patrimonial value on which its incidence depends is calculated by autonomous fractions that did not exist at the time of the assessment."

It appears to us that the respondent is not correct, for the reasons set out above and further because we do not see in what way the principle of legality could interfere with the application of the interpretive criteria provided for in article 9 of the Civil Code.

  1. On the other hand, it is understood that the interpretation sustained here, in line with the uniform arbitral jurisprudence mentioned above, is the one that harmonizes with the constitutional principles of fiscal equality and contributive capacity, inasmuch as it would not be acceptable in face of these principles the manifestly unequal taxation of substantially identical realities, only for the formal reason that in some cases horizontal property was constituted and in others it was not.

  2. In the same vein goes the consideration of the principle of systematic coherence, which would also be affected by the consideration of these realities in the context of IMI with substantively identical status to that of fractions of properties formally constituted in horizontal property, whereas what would occur in the context of stamp tax, in accordance with the solution sustained by the Respondent.

  3. For the foregoing, it is considered that in the case of urban properties with parts or storeys susceptible to independent use, the value to be considered for purposes of applying item 28 of the TGIS is the taxable patrimonial value of each of those independent parts, with only those parts susceptible to independent use whose own taxable patrimonial value is greater than € 1,000,000 being subject to this tax.

  4. In the present case, as the taxable patrimonial value of each of the parts susceptible to independent use is less than that value, they do not fall within the tax incidence norm, and therefore the assessments sub judice are tainted by the defect of violation of law.

  5. Thus, the examination of the other questions raised by the Claimant is foreclosed, pursuant to article 124 of the CPPT, by application of article 29, paragraph 1 of the RJAT, as well as of any other of which the Tribunal could officially have knowledge.

IV – Decision

Accordingly, the arbitral tribunal decides to find the impugnation entirely well-founded, declaring the illegality and consequent annulment of the assessments in question, as well as of the act of rejection of the gracious complaint filed by the Claimants.

Value of the action: € 16,726.00 (sixteen thousand, seven hundred and twenty euros) pursuant to the provisions of article 315, paragraph 2, of the CPC and 97-A, paragraph 1, letter a), of the CPPT and 3, paragraph 2, of the Regulation of Costs in Arbitration Proceedings.

Costs against the Respondent, in the amount of € 1,224.00 (one thousand, two hundred and twenty-four euros) pursuant to paragraph 4 of article 22 of the RJAT.

Lisbon, CAAD, 23 July 2014.

The Arbitrator

(Marcolino Pisão Pedreiro)

[1] Also in the sense of individualized consideration of these parts susceptible to independent use, article 119, paragraph 1 of the CIMI determines that the tax collection document shall contain the "specification of the properties, their parts susceptible to independent use, respective taxable patrimonial value".

Also pointing in the same direction, article 15-O of Decree-Law no. 287/2003, of 20 November, added by Law 60-A/2011 of 30/11, referring to the collection of IMI for purposes of the safeguard regime, mentions "property or part of urban property subject to general assessment".

[2] TAXES ON REAL ESTATE PROPERTY, STAMP TAX, Annotated and Commented, Engifisco, 1st Edition, 2005, pages 159-160.

[3] This was already the case under the Code of Real Estate Contribution and Tax on Agriculture Industry and the Code of Municipal Contribution.

The circular offices nos. 40012, of 23.12.1999 and 40.025, of 11.08.2000 (which can be consulted in THE MUNICIPAL PROPERTY TAX CODE, Commented and Annotated, by Martins Alfaro, Áreas Editora, 2004, 589-592, in the work cited by Silvério Mateus and Corvelo de Freitas, pages 294-295 and 259-261, and the second can still today be consulted on the website http://info.portaldasfinancas.gov.pt/pt/informacao_fiscal/legislacao/instrucoes_administrativas/oficios_circulados_contribuicao_autarquica.htm) even clarified the understanding that, save in cases of reconstruction, modification or improvement of the property which involves some variation of the taxable value, the passage to the horizontal property regime does not give rise to a new assessment.

[4] Handed down in proceedings 50/2013-T, 132-2013-T, 181/2013-T, 183/2013-T, 185/2013-T, 248/13, which can be consulted at https://caad.org.pt/.

[5] We use here the expression in the sense of part or storey susceptible to independent use.

Frequently Asked Questions

Automatically Created

Does Verba 28 of the Portuguese Stamp Tax apply to individual units in a vertical property?
Under Portuguese tax law, Verba 28 of the Stamp Tax applies to vertical property as a single unit, not to individual apartments or divisions. The Tax Authority position, as contested in CAAD case 72/2014-T, treats vertical property (propriedade vertical) differently from horizontal property (propriedade horizontal), where only autonomous fractions constitute separate properties under Article 2 of CIMI. Individual units within vertical property cannot benefit from separate treatment even if they have independent economic use.
Can stamp tax be levied on apartments valued under €1 million within a single building?
Yes, stamp tax under Verba 28 can be levied on apartments valued individually under €1 million if they form part of a vertical property whose aggregate taxable patrimonial value exceeds €1 million. In case 72/2014-T, the Tax Authority assessed stamp tax on each apartment and cellar within a building despite individual IMI valuations below the €1 million threshold, calculating tax based on the total property value as a single unit rather than separate fractions.
What is the CAAD arbitration procedure for challenging stamp tax assessments in Portugal?
The CAAD arbitration procedure for challenging Portuguese stamp tax assessments requires filing a request to constitute an arbitral tribunal under Article 10 of Decree-Law 10/2011 (RJAT). Taxpayers must identify the contested liquidation acts and prior administrative decisions (such as rejected gracious complaints). The CAAD President designates an arbitrator, the tribunal is constituted within legal deadlines, and a preliminary meeting under Article 18 of RJAT is scheduled where parties present their positions before the tribunal issues a binding arbitral decision.
Are vertical property units assessed individually or as a whole for Imposto de Selo purposes?
Vertical property units are assessed as a whole for Imposto de Selo purposes under Verba 28, not individually. Portuguese tax law treats vertical property (propriedade vertical) as a single property unit, even when composed of multiple floors or divisions with independent economic use. This contrasts with horizontal property (propriedade horizontal) where autonomous fractions are considered separate properties. The Tax Authority's position in case 72/2014-T emphasizes that civil law distinctions apply in tax matters, precluding analogical interpretation between these different property regimes.
How to challenge lack of reasoning in Portuguese stamp tax liquidation acts?
To challenge lack of reasoning in Portuguese stamp tax liquidation acts, taxpayers can invoke Article 268(3) of the Portuguese Constitution and Article 77(1) of the General Tax Law (LGT), which require proper grounds for administrative acts. In CAAD arbitration, taxpayers must demonstrate that the assessment lacks sufficient explanation to understand the administration's decision-making process. This procedural defect can constitute grounds for annulment. Taxpayers should first file a gracious complaint (reclamação graciosa) and, if rejected, may pursue CAAD arbitration under RJAT to obtain judicial review of both substantive and formal defects in tax assessments.