Process: 764/2016-T

Date: May 15, 2017

Tax Type: Selo

Source: Original CAAD Decision

Summary

CAAD Process 764/2016-T addressed the application of Stamp Tax (Imposto de Selo) under Verba 28.1 of the General Stamp Tax Table (TGIS) to vertical property. The claimant challenged 26 stamp duty assessments totaling €6,244.52 for the 3rd installment of 2015, relating to residential floors in a Lisbon property held under vertical ownership (propriedade vertical) rather than horizontal ownership regime. The central legal issue concerned whether each floor could be assessed and challenged separately, or whether the property should be treated as a single unit for stamp tax purposes. The claimant argued that each floor had independent economic use with separately determined patrimonial values, making the assessments severable and independently challengeable. The Tax Authority countered that Verba 28.1 TGIS applies when two conditions are met: residential character and total patrimonial value equal to or exceeding €1,000,000. The AT maintained that the property's total taxable value for residential divisions exceeded this threshold, justifying the stamp duty assessment based on cadastral information. The case highlights critical procedural questions about the divisibility of tax assessments in arbitral proceedings and substantive issues regarding the correct interpretation of Verba 28 TGIS for properties not subject to horizontal ownership. The arbitral tribunal was constituted on March 7, 2017, with jurisdiction under RJAT to review the legality of the contested assessments, which the claimant alleged suffered from incorrect classification and quantification of taxable property values under CIMI rules.

Full Decision

ARBITRAL DECISION

REPORT

A - PARTIES

A..., with registered address at Street ..., ..., ... ...-... Lisbon, bearing the tax identification number for a legal entity ..., hereinafter designated as the Claimant or taxpayer.

TAX AND CUSTOMS AUTHORITY, hereinafter designated as the Respondent or AT.

The request for constitution of the arbitral tribunal was accepted by the President of CAAD, and the Arbitral Tribunal was regularly constituted on 16-03-2016, to examine and decide the subject matter of the present proceedings, and was automatically notified to the Tax and Customs Authority on 07-03-2017, as recorded in the respective minutes.

The Claimant did not proceed with the appointment of an arbitrator, wherefore, in accordance with the provisions of no. 1 of article 6 and sub-paragraph b) of no. 1 of article 11 of Decree-Law no. 10/2011, of 20 January, in the wording introduced by article 228 of Law no. 66-B/2012, of 31 December, the Deontological Council appointed Mr. Paulo Ferreira Alves, the appointment having been accepted in accordance with legal provisions.

On 14-02-2017 the parties were duly notified of such appointment and did not manifest any desire to refuse the appointment of the arbitrators, in accordance with article 11 no. 1, sub-paragraphs a) and b), of the RJAT and articles 6 and 7 of the Deontological Code.

In accordance with the provisions of sub-paragraph c) of no. 1 of article 11 of Decree-Law no. 10/2011, of 20 January, in the wording introduced by article 228 of Law no. 66-B/2012, of 31 December, the singular arbitral tribunal is regularly constituted on 07-03-2017.

Both parties agree to waive the meeting provided for in article 18 of the RJAT.

The arbitral tribunal is regularly constituted. It is materially competent, in accordance with articles 2, no. 1, sub-paragraph a), and 30, no. 1, of Decree-Law no. 10/2011, of 20 January.

The parties have legal standing and capacity, are legitimate and are legally represented (articles 4 and 10, no. 2, of the same diploma and article 1 of Ministerial Order no. 112-A/2011, of 22 March).

The proceedings do not contain defects that would invalidate them.

B - CLAIM

  1. The present Claimant requests a declaration of illegality of the tax assessment acts relating to Stamp Duty: no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016... and no. 2016..., all relating to the 3rd Instalment of Stamp Duty which set a total tax liability of € 6,244.52 (six thousand two hundred and forty-four euros and fifty-two cents).

C - GROUNDS FOR THE CLAIM

  1. In support of its request for arbitral determination, the Claimant alleged, with a view to securing a declaration of illegality of the tax assessment acts relating to Stamp Duty, already described in item 1 of this Award, in brief, the following:

  2. The Claimant was notified of the stamp duty assessment relating to the cadastral items ...-SL D, ...-SL E, ...-1 D, ...-1 FD, ...-1 FE, ...-1E, ...-2 D, ...-2 FD, ... FE, ... 2 E, ... 3 D, ... 3 FD, ... 3 FE, ... 3 E, ... 4 D, ... 4 FD, ... 4 FE, ... 4 E, ... 5 D, ... 5 FD, ... 5 FE, ... 5 E, ... 6 FD. ... 6 FE ... 6 E, all of the parish of ..., municipality of Lisbon, relating to the year 2015.

  3. The stamp duty assessment notices relate to the 3rd Instalment of Stamp Duty, with the payment deadline in the month of November 2016.

  4. The assessments concern the residential floors of an urban property not subject to the horizontal ownership regime, that is, in vertical ownership, belonging to the Respondent located at Street ..., no. ... to ..., parish ..., municipality of Lisbon.

  5. The patrimonial value of the fractions is less than €1,000,000.

  6. The Claimant contends that there is a right to lodge a claim or challenge the assessments in question for each of the notifications by the AT to the claimant, conferring upon them a severable character.

  7. Further, the Claimant argues that the AT, in issuing the stamp duty collection notices as it does, grants the taxpayer the opportunity to oppose the same separately, that is, by instalment, recognizing the divisibility and autonomous challengeability of each of the tax assessment acts.

  8. The Claimant has already requested the constitution of an arbitral tribunal to rule on the illegality of the stamp duty assessment affecting the property in question when notified of the assessments relating to the 1st Instalment, which is pending before CAAD in case 314/2016-T.

  9. Each of the floors is capable of independent economic use and had its taxable property value determined separately by the AT, in accordance with the rules of the CIMI.

  10. The Claimant contends that the assessments suffer from illegality due to incorrect classification and quantification of income, property values and other taxable facts in violation of item 28.1 of the General Table of Stamp Duty.

D - THE RESPONDENT'S ANSWER

  1. The Respondent, duly notified for such purpose, timely filed its answer in which, in abbreviated summary, alleged the following:

  2. The subjection to stamp duty of item 28.1 of the General Table attached to the CIS results from the conjunction of two facts: the residential character and the patrimonial value of the urban property registered in the cadastre being equal to or greater than € 1,000,000.00

  3. Regarding residential character: Urban properties may be, among others, residential or for services, in accordance with sub-paragraphs a) and b) of no. 1 of article 6 of the CIMI.

  4. The property is described in the cadastre under a regime of full ownership, consisting of divisions or floors capable of independent use.

  5. For the calculation of the TPV, the coefficient varies according to its intended use, and, being the total taxable property value of the property relating to the divisions intended for housing greater than €1,000,000.00, the allocation coefficient applied was 1.00.

  6. Being this the cadastral information, in accordance with article 23, no. 7 of the CIS, the stamp duty assessment in question was effected by the Tax Authority, taking into account the nature of the urban property, namely its divisions allocated to housing, as of the date of the taxable event, applying, with the necessary adaptations, the rules contained in the CIMI.

  7. Thus, taking into account the cadastral information contained in the property record book, the Claimant fails, with the documents it attaches to the record, to provide evidence that contradicts the nature of the divisions with residential character.

  8. Therefore, the contested stamp duty assessments were issued in accordance with the information contained in the property record book of the property, and are therefore valid and do not suffer from any illegality.

  9. Regarding the patrimonial value of the urban property registered in the cadastre being equal to or greater than € 1,000,000.00: As of that date, the Claimant held full ownership of the urban property in question, evaluated in accordance with the CIMI, in the context of the general assessment of urban properties, described as "property in full ownership with floors or divisions capable of independent use", with a taxable property value (VP) greater than € 1,000,000.00.

  10. In compliance with and in accordance with the provisions of article 6, no. 2 of Law no. 55-A/2012, of 29/10, which added item no. 28 to the TGIS, with the amendment made by Law no. 83-C/2013 of 31/12, and whose respective incidence norm refers to urban properties evaluated in accordance with the CIMI, with VP equal to or greater than € 1,000,000.00 and, in accordance with its no. 28.1, residential allocation, the AT proceeded with the notification of collection documents for payment of the assessments in question.

  11. Article 44, no. 5 of the CIS, in the wording given to it by Law no. 55-A/2012, of 29/10, provides that, where assessment occurs, the tax referred to in item 28 of the TGIS is paid within the periods, terms and conditions set forth in article 120 of the CIMI, in three instalments in the months of April, July and November, in accordance with no. 1, sub-paragraph c) of the aforementioned article 120.

  12. Now, what is at issue here are collection notices (assessment) that result from the direct application of the legal rule, which is translated into objective elements, without any subjective or discretionary appraisal.

  13. As regards the IMI assessment, being properties in full ownership, the VP that serves as the basis for its calculation will be indisputably the VP which the present Respondent defines as the "global value of the property".

  14. In compliance with the provisions of article 119, no. 1 of the CIMI, the collection document is sent to the taxpayer with a breakdown of the parts capable of independent use, the respective taxable property value and the amount of tax attributable to each municipality where the properties are located.

  15. The Respondent concludes by arguing that the impugned tax acts, in terms of substance, did not violate any legal or constitutional provision and should be maintained in the legal order.

E - FACTUAL FINDINGS

  1. Before proceeding with the examination of these questions, it is necessary to present the factual matter relevant for their understanding and decision, which has been effected on the basis of documentary evidence and taking into account the facts alleged.

  2. In terms of relevant facts, this tribunal finds proven the following facts:

  3. The Claimant is the owner of an urban property corresponding to a property in full (non-horizontal) ownership with floors or divisions capable of independent use.

  4. The stamp duty assessment notices relate to the 3rd Instalment of Stamp Duty, with the payment deadline in the month of November 2016.

  5. The patrimonial value of the fractions is less than €1,000,000.

  6. The aforementioned property consists of 8 floors, corresponding to Ground Floor, warehouse, mezzanine/shop, and six floors, located at Street ..., no. ... to ..., parish of ..., municipality of Lisbon.

  7. The patrimonial value of the property only regarding the fractions for independent use with residential character of the property is €1,632,740.00.

  8. The assessment notices for the respective property, as to the 2nd and 3rd Instalment of Stamp Duty, concern the following floors and divisions, whose patrimonial value of the said divisions with independent use, which make up the urban property, was determined separately, in accordance with the provisions of article 7, no. 2, sub-paragraph b), of the Real Estate Tax Code (CIMI), resulting in the issuance of the following tax assessment acts, relating to 2nd and 3rd Instalment, here challenged:

34.1. Tax Assessment Act no. 2016..., with a tax amount to assess of €, and relating to 3rd Instalment with the amount to pay of €, and relating to 3rd Instalment with the amount to pay of 785.60€, and relating to 3rd Instalment with the amount to pay of 261.86€, and with a TPV of 78,580.00 €, relating to ... SL D;

34.2. Tax Assessment Act no. 2016..., with a tax amount to assess of 785.60€ and relating to 3rd Instalment with the amount to pay of 261.86€, and with a TPV of 78,580.00 €, relating to ... SL E;

34.3. Tax Assessment Act no. 2016..., with a tax amount to assess of 790.80€ and relating to 3rd Instalment with the amount to pay of 263.60€, and with a TPV of 79,080.00 €, relating to ...1 D;

34.4. Tax Assessment Act no. 2016..., with a tax amount to assess of 387.60€ and relating to 2nd Instalment with the amount to pay of 193.80€, and with a TPV of 38,760.00 €, relating to ... 1 FD;

34.5. Tax Assessment Act no. 2016..., with a tax amount to assess of 387.60€ and relating to 2nd Instalment with the amount to pay of 193.80€, and with a TPV of 38,760.00 €, relating to ... 1 FE;

34.6. Tax Assessment Act no. 2016..., with a tax amount to assess of 790.80€ and relating to 3rd Instalment with the amount to pay of 263.60€, and with a TPV of 79,080.00 €, relating to ... 1 E;

34.7. Tax Assessment Act no. 2016..., with a tax amount to assess of 832.70€ and relating to 3rd Instalment with the amount to pay of 277.56€, and with a TPV of 83,270.00 €, relating to ... 2 D;

34.8. Tax Assessment Act no. 2016..., with a tax amount to assess of 399.10€ and relating to 2nd Instalment with the amount to pay of 199.55€, and with a TPV of 39,910.00 €, relating to ... 1 FD;

34.9. Tax Assessment Act no. 2016..., with a tax amount to assess of 399.10€ and relating to 2nd Instalment with the amount to pay of 199.55€, and with a TPV of 39,910.00 €, relating to ... 1 FE;

34.10. Tax Assessment Act no. 2016..., with a tax amount to assess of 832.70€ and relating to 3rd Instalment with the amount to pay of 277.56€, and with a TPV of 83,270.00 €, relating to ... 2 E;

34.11. Tax Assessment Act no. 2016..., with a tax amount to assess of 840.70€ and relating to 3rd Instalment with the amount to pay of 280.23€, and with a TPV of 84,070.00 €, relating to ... 3 D;

34.12. Tax Assessment Act no. 2016..., with a tax amount to assess of 403.00€ and relating to 2nd Instalment with the amount to pay of 201.50€, and with a TPV of 40,300.00 €, relating to ... 3 FD;

34.13. Tax Assessment Act no. 2016..., with a tax amount to assess of 403.00€ and relating to 2nd Instalment with the amount to pay of 201.50€, and with a TPV of 40,300.00 €, relating to ... 3 FE;

34.14. Tax Assessment Act no. 2016..., with a tax amount to assess of 820.40€ and relating to 3rd Instalment with the amount to pay of 273.46€, and with a TPV of 82,040.00 €, relating to ... 3 E;

34.15. Tax Assessment Act no. 2016..., with a tax amount to assess of 840.70€ and relating to 3rd Instalment with the amount to pay of 280.23€, and with a TPV of 84,070.00 €, relating to ... 4 D;

34.16. Tax Assessment Act no. 2016..., with a tax amount to assess of 403.00€ and relating to 2nd Instalment with the amount to pay of 201.50€, and with a TPV of 40,300.00 €, relating to ... 4 FD;

34.17. Tax Assessment Act no. 2016..., with a tax amount to assess of 403.00€ and relating to 2nd Instalment with the amount to pay of 201.50€, and with a TPV of 40,300.00 €, relating to ... 4 FE;

34.18. Tax Assessment Act no. 2016..., with a tax amount to assess of 820.40€ and relating to 3rd Instalment with the amount to pay of 273.46€, and with a TPV of 82,040.00 €, relating to ... 4 E;

34.19. Tax Assessment Act no. 2016..., with a tax amount to assess of 840.70€ and relating to 3rd Instalment with the amount to pay of 280.23€, and with a TPV of 84,070.00 €, relating to ... 5 D;

34.20. Tax Assessment Act no. 2016..., with a tax amount to assess of 406.80€ and relating to 2nd Instalment with the amount to pay of 203.40€, and with a TPV of 40,680.00 €, relating to ... 5 FD;

34.21. Tax Assessment Act no. 2016..., with a tax amount to assess of 406.80€ and relating to 2nd Instalment with the amount to pay of 203.40€, and with a TPV of 40,680.00 €, relating to ... 5 FE;

34.22. Tax Assessment Act no. 2016..., with a tax amount to assess of 848.70€ and relating to 3rd Instalment with the amount to pay of 282.90€, and with a TPV of 84,870.00 €, relating to ... 5 E;

34.23. Tax Assessment Act no. 2016..., with a tax amount to assess of 828.30€ and relating to 3rd Instalment with the amount to pay of 276.10€, and with a TPV of 82,830.00 €, relating to ... 6-D;

34.24. Tax Assessment Act no. 2016..., with a tax amount to assess of 406.80€ and relating to 2nd Instalment with the amount to pay of 203.40€, and with a TPV of 40,680.00 €, relating to ... 6 FD;

34.25. Tax Assessment Act no. 2016..., with a tax amount to assess of 406.80€ and relating to 2nd Instalment with the amount to pay of 203.40€, and with a TPV of 40,680.00 €, relating to ... 6 FE;

34.26. Tax Assessment Act no. 2016..., with a tax amount to assess of 848.70€ and relating to 3rd Instalment with the amount to pay of 282.90€, and with a TPV of 84,870.00 €, relating to ... 6 E;

  1. The patrimonial value of the fractions for independent use with residential character of the property as of the date of the assessments is €1,632,740.00, and none of the parties or floors with residential character and independent use has a taxable property value greater than €1,000,000.00.

  2. The AT assessed the stamp duty provided for in item no. 28 and 28.1 of the General Table of Stamp Duty (TGIS), in the wording introduced by article 4 of Law no. 55-A/2012, of 29/10, at the rate of 0.5% and 1%, considering as "TPV – total subject to tax", from the stamp duty assessments resulted a tax amount to be paid with a global value of 12,589.50 €.

  3. The respondent was notified for payment of stamp duty, calculated on the global value of the fractions with residential character and taxed individually on each fraction.

  4. The Claimant proceeded with the payment of tax in the amount of € 6,244.52 (six thousand two hundred and forty-four euros and fifty-two cents), corresponding to the last instalment, respectively 2nd and 3rd instalments.

F - UNPROVEN FACTS

  1. Of the facts of interest for the decision of the case, contained in the challenge, all objects of concrete analysis, the facts not contained in the above factual statement were not proven.

G - ISSUES TO BE DECIDED

  1. In view of the positions assumed by the parties in the arguments presented, the following constitute central issues to be resolved and must be examined and decided:

a. The preliminary issue raised by the respondent regarding exceptions invoked;

b. The one raised by the Claimant:

(i) The one raised by the Claimant, for declaration of illegality of the tax assessment acts relating to Stamp Duty of the year 2015, no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016..., no. 2016... and no. 2016..., which set a total tax liability of € 6,244.52 (six thousand two hundred and forty-four euros and fifty-two cents).

H. PRELIMINARY ISSUE: EXCEPTION OF LACK OF JURISDICTION OF THE ARBITRAL TRIBUNAL

  1. The Respondent contends that, given the manifest non-challengeability of the individual instalments of the assessment acts contained in the collection notices which are the object of the present request for arbitral determination, the dilatory exception provided for in sub-paragraph c), of no. 1, of article 89 of the CPTA, subsidiarily applicable by article 29, no. 1, sub-paragraph c), of the RJAT, occurs, which prevents examination of the merits and entails the dismissal of the AT from the proceedings.

  2. The Respondent alleges that the assessment act under item 28 of the IS is unique, and the fact that it may be paid in various instalments does not imply that several assessments have occurred. The nature of the instalments of such a tax assessment is the division of the global assessment, effected annually, and each instalment per se cannot be challenged autonomously, as the object of judicial challenge or of the arbitral tax proceedings is the tax assessment act.

  3. Further, the Respondent argues that the annulment of the tax assessment act necessarily affects all instalments, bringing the obligation to pay them to an end or imposing on the tax administration the obligation to refund the amounts eventually paid by the taxpayer.

  4. A period for response was granted to the Claimant for the exceptions invoked, which it did not present.

  5. In view of the position assumed by the parties, in light of the exception invoked, it falls to this tribunal to decide as follows.

  6. It is apparent from the Urban Property Record of the property that there are fractions for independent use with residential character; the claimant attached the assessment notices relating to each of the fractions for independent use with residential character of the property, relating to the 2nd and 3rd instalment of Stamp Duty.

  7. The value attributed to the arbitral petition by the Claimant relates to the sum of the tax assessed in the Stamp Duty assessment acts here challenged by the claimant, corresponding to the last instalment, respectively 2nd and 3rd instalments in the total amount of € 6,244.52.

  8. Being that the value of the amount of the assessment acts here challenged is € 16,319.40.

  9. On the challenge of stamp duty assessment acts, when issued in instalments, the following is stated.

  10. It is an indivisible act of a Stamp Duty assessment, in accordance with the combined provisions of articles 120 and 113, no. 1, both of the Real Estate Tax Code, applicable by reference from no. 7 of article 23 of the Stamp Duty Code, in the wording given to it by Law no. 55-A/2012, of 29 October, it follows that, in the situations referred to in item 28 of the TGIS, an annual assessment is effected, payment in instalments being nothing more than a collection technique for the tax and not a partial payment thereof.

  11. As it is not a divisible tax assessment act, in the sense that "if partial annulment of a tax assessment act is requested, the court cannot, in principle, annul it entirely"[1], the request for annulment of the S.T. assessment act from any of the three instalments will be challengeable exclusively as to the act of determination of the tax amount and not as to the tax to be paid in that instalment.

  12. Thus the request for annulment of the act may be requested at any time from the date of notification of one of the instalments or of the rejection of the administrative claim.

  13. Being that the Stamp Duty assessment act that may be annullable and challengeable is the act of determination of the tax amount, the same cannot be divisible and autonomously challengeable, its annulment entails the annulment of the payment acts, respectively the three or all instalments.

  14. On the question of the indivisibility of a Stamp Duty assessment (item 28 of the TGIS), CAAD has already ruled in cases no. 408/2014-T, 138/2015-T, 387/2014, 726/2014-T, 736/2014-T and 90/2015-T, (available at https://caad.org.pt/tributario/decisoes/), as set out in the excerpt from case no. 205/2013-T:

"11. The Respondent further challenges the value of the case considering it to be 8,940.94€ and not 28,822.80€ as indicated by the claimant. The claimant contends that 'the challenged act in these proceedings is the assessment act with no. ...of 22/02/2013, relating to the first instalment of stamp duty for the year 2012, in the amount of € 8,940.94, attached by the claimant to the request for arbitral determination as Doc. 1'. However, the value of assessment no. ... of 22/02/2013, as stated in the aforementioned document, is in reality 26,822.00 € and not € 8,940.94.'

Note that there is no assessment of € 8,940.94. This value is only the first instalment of an assessment that was immediately effected and in the amount indicated by the Claimant. From the fact that the value of the assessment may be paid in several instalments, it does not follow that there are three assessments. Rather, it is an assessment that may be paid in several instalments (emphasis ours), the taxpayer not being prevented from challenging the same due to the fact that the payment deadline for only one of them has so far elapsed."

  1. The payment instalments of a Stamp Duty assessment, in accordance with Item 28 of the TGIS, are not autonomously challengeable, since they have their origin in a single annual obligation, in accordance with the teaching of Braz Teixeira: "It is necessary not to confuse periodic instalments which, although effected by successive acts at different times, have their origin in the same obligation and constitute the various portions of the same instalment that was divided, with instalments that should be effected periodically, not due to a division of the global instalment, but rather to the periodic birth of new obligations, from the persistence of the factual assumptions of the taxation."

  2. Now, in cases where the tax must be paid in instalments, the assessment is notified to the taxpayer together with the notification for payment of each of the instalments, only being able to be challenged in its entirety and not instalment by instalment.

  3. On the lack of jurisdiction of the arbitral tribunal to annul an instalment of a Stamp Duty assessment, the Collective Arbitral Tribunal constituted in case no. 442/2014-T has recently ruled, as follows from the excerpt transcribed (decision available at https://caad.org.pt/):

"(...) the Claimant is correct in arguing that the value of the case should be that of the assessments for which it requests a declaration of illegality and not the value of the 1st instalment of each of the properties referred to, as it is the illegality of the annual assessments that the Claimant seeks. Moreover, the jurisdiction of the arbitral tribunals operating at CAAD covers requests for declaration of illegality of assessment acts and not the instalments through which the collection of the amounts assessed is made."

  1. It is the illegality of the annual assessment that the Claimant seeks to annul.

  2. As we have verified, the present tax is indivisible, so its challenge means the annulment of all three instalments, and not the other way around; the decision must concern the act in its entirety, its annulment entails its total annulment.

  3. As the three instalments are not issued simultaneously, and as the act to be annulled is not divisible, it cannot be considered that non-challenge through the administrative channels of one of the instalments means that the taxpayer has lost its right to defend itself regarding the same.

  4. In light of the formulation of the claimant's request, the same seeks the annulment of the Stamp Duty assessment act determined within the scope of item 28, year 2015, which established a tax amount payable of 16,319.40€, not limiting and not arguing its position with the annulment of the 1st instalment of Stamp Duty.

  5. There is no expansion of the request, since, as the acts are indivisible, the challenge of one benefits the others; however, the value initially attributed by the Claimant to the arbitral request does not correspond to its claim.

  6. Being that the tax assessment act in question is the Stamp Duty assessment act determined within the scope of item 28, year 2015, the value of the arbitral proceedings must be the value corresponding to the tax challenged, or in this case the Stamp Duty amount, respectively 16,319.40€.

  7. Given that the Claimant did not proceed with correction and payment of the arbitration fee for the procedural value of 16,319.40€, corresponding to the amount, and in compliance with the principles of procedural economy, the existence of lack of jurisdiction of the tribunal as to the value of the case is verified, thus exceeding its jurisdiction.

  8. In these terms, as each of the payment instalments of the Stamp Duty assessments identified in the record are not autonomously challengeable, for the reasons previously stated, this would be a case of lack of jurisdiction of the arbitral tribunal to examine and declare their illegality and consequent annulment.

  9. In view of the foregoing, the present tribunal considers that the Stamp Duty assessment of item 28 of the TGIS is indivisible, each of its instalments not being autonomously challengeable, this falling within the category of "non-challengeability of the challenged act", which prevents the continuation of the proceedings and the examination of the merits of the case, wherefore it is decided to dismiss the Respondent from the proceedings.

I - DECISION

Accordingly, in light of all the foregoing, the present Arbitral Tribunal decides:

To judge as unfounded the request for declaration of illegality of the tax assessment acts relating to Stamp Duty, no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015...; no. 2015..., which set a total tax liability of € 6,244.52 (six thousand two hundred and forty-four euros and fifty-two cents).

The value of the case is fixed at € 6,244.52 from the value of the assessment taking into account the economic value of the case assessed by the value of the tax assessments challenged, and in accordance therewith the costs are fixed in the respective amount of 612.00€ (six hundred and twelve euros), to be borne by the claimant in accordance with article 12, no. 2 of the Regime for Tax Arbitration, article 4 of the RCPAT and Table I attached hereto – no. 10 of article 35, and nos. 1, 4 and 5 of article 43 of the LGT, articles 5, no. 1, sub-paragraph a) of the RCPT, 97-A, no. 1, sub-paragraph a) of the CPPT and 559 of the CPC).

Let notification be made.

Lisbon, 15 May 2017

The Arbitrator

Dr. Paulo Ferreira Alves

[1] SOUSA, Jorge Lopes de, "Code of Procedure and Tax Process – annotated and commented" Volume II, 6th Edition, Áreas Editora, 2011, p. 319.

Frequently Asked Questions

Automatically Created

What is the Stamp Tax (Imposto de Selo) applicable to vertical property under Verba 28 of the TGIS?
Stamp Tax under Verba 28.1 of the TGIS applies to urban properties with residential allocation (habitação) when the taxable patrimonial value (valor patrimonial tributário) registered in the cadastre equals or exceeds €1,000,000. For vertical property (propriedade vertical), which is property held in full ownership with floors or divisions capable of independent use but not subject to horizontal ownership regime, the Tax Authority aggregates the values of all residential divisions to determine if the €1,000,000 threshold is met. The tax assessment applies the allocation coefficient of 1.00 for residential use and evaluates the property according to CIMI rules, considering the cadastral information as of the taxable event date.
How does CAAD arbitration work for challenging Stamp Tax liquidation acts in Portugal?
CAAD (Centro de Arbitragem Administrativa) arbitration for Stamp Tax challenges involves filing a request for constitution of an arbitral tribunal within 90 days of notification of the assessment. The CAAD President accepts the request and constitutes the tribunal, either singular or collective, depending on party appointments. Parties are notified of arbitrator appointments and may refuse within legal deadlines. The tribunal must verify its jurisdiction, party standing, and legitimacy. Both parties may waive the preliminary hearing under RJAT Article 18. The claimant files the initial petition, the Tax Authority submits its answer, and the tribunal issues a binding decision on the legality of the contested assessments, examining whether the AT correctly applied tax law and properly quantified the tax liability.
Can taxpayers dispute multiple Stamp Tax assessments in a single arbitral proceeding?
The question of whether taxpayers can dispute multiple Stamp Tax assessments in a single arbitral proceeding depends on the divisibility and autonomous nature of each assessment. In Process 764/2016-T, the claimant argued that each of the 26 assessments (relating to different cadastral items and issued as separate notifications) had severable character and could be challenged independently. The claimant noted that the Tax Authority itself issued separate collection notices for each instalment, recognizing their divisibility. However, the case also raises whether assessments relating to different floors of the same vertical property, all subject to the same legal and factual circumstances, should be consolidated in a single proceeding or may be challenged separately, as the claimant had already filed another arbitration (314/2016-T) for the 1st instalment of the same property.
What are the legal grounds for contesting Stamp Tax on vertical property (propriedade vertical) in Portugal?
Legal grounds for contesting Stamp Tax on vertical property include: (1) incorrect classification of property character (arguing divisions lack residential allocation or challenging the cadastral classification); (2) incorrect quantification of patrimonial value (disputing whether the €1,000,000 threshold is met or challenging individual VPT determinations); (3) improper aggregation of values (arguing that floors with independent economic use and separate VPT determinations should not be aggregated for Verba 28 purposes); (4) misapplication of CIMI evaluation rules; (5) violation of principles that properties not subject to horizontal ownership should be treated differently; (6) errors in cadastral information that formed the basis for assessment under CIS Article 23(7); and (7) procedural irregularities in the assessment process. Taxpayers must provide evidence contradicting the cadastral information to overcome the presumption of correctness afforded to Tax Authority determinations based on property records.
What was the outcome of CAAD Process 764/2016-T regarding Stamp Tax on vertical property?
The excerpt of CAAD Process 764/2016-T does not include the final decision section. The available report establishes that the arbitral tribunal was regularly constituted on March 7, 2017, found itself materially competent under RJAT, and verified that parties had proper standing and legal representation. The claimant sought a declaration of illegality for 26 stamp duty assessments totaling €6,244.52, arguing incorrect classification and quantification. The Tax Authority defended the assessments as valid based on cadastral information showing total residential VPT exceeding €1,000,000. The case involved complex issues of whether vertical property floors should be assessed aggregately or separately, and whether multiple related assessments could be challenged in separate arbitrations. The tribunal's substantive ruling on these issues and the ultimate outcome (upholding or annulling the assessments) are not provided in this text excerpt.