Tax lawyers consulted by the electronic magazine Consultor Jurídico considered the Supreme Court's decision to establish that credits from the Tax on Industrialized Products (IPI) do not form the basis for calculating the contribution to the Social Integration Program (PIS) and the Social Security Contribution (Cofins) to be positive.
The issue, which has general repercussion, was ruled on this week. The Federal Government challenged a decision by the Federal Regional Court of the 4th Region (TRF-4) according to which credits received by an agricultural equipment company do not constitute taxable income for PIS and Cofins when derived from export operations.
According to experts, the Supreme Court's decision brings legal certainty because it settles once and for all the argument against the government's view that the IPI credit is part of the PIS/Cofins calculation basis.
"The decision puts an end to the notable legal uncertainty that haunted the export sector. It is necessary, however, to await any modulation of the decision, so that it is possible to assess the extent of the effects of the new guidance, especially for the purposes of repeating past amounts unduly collected," says Lesliê Mourad, a partner at Schuch Advogados.
According to her, the Internal Revenue Service has been demanding for years that presumed IPI credits be calculated as if they were billable revenue, despite the tax burden they create for exporting companies.
"Under the terms of Law 9.363/1996, presumed IPI credits correspond to tax benefits enjoyed by exporting companies subject to the cumulative calculation of PIS and Cofins contributions, granted as reimbursement for the tax burden arising from the levying of these same contributions on transactions involving the acquisition, in the domestic market, of raw materials, intermediate products and packaging materials used in the production processes of exported goods."
According to the lawyer, the credits are not the same as the cash income that makes up the company's turnover and should be seen as a tax incentive to relieve exports.
Bruno Teixeira, a partner at TozziniFreire Advogados, explains that the decision concluded that the cumulative PIS/Cofins is based on billing, while the IPI credit is not billing. Therefore, there could be no levy on presumed credits.
"The non-cumulative regime, due to the prohibition in Law 10.833, does not allow you to appropriate this presumed IPI credit. So, for cumulative PIS/Cofins, the calculation basis is billing. Billing is the result of companies selling products, goods or providing services, which is different from the concept of revenue. Revenue is any and all income that increases assets by increasing assets or reducing liabilities. You can have financial income, you can have income from fixed assets, you can have various types of income in the company's results. Turnover is one and the same, it's the sale of goods or services."
André Felix Ricotta de Oliveira, PhD professor in Tax Law and partner at Felix Ricotta Advocacia, says that the Supreme Court's decision was consistent with what was decided in Theme 69, in which ICMS was excluded from the calculation basis of these taxes.
"When ruling on the issue, the Supreme Court used the concept of revenue or turnover as the economic amount that enters the taxpayer's coffers as a result of their business activity," he said. "The presumed credit is nothing more than a subsidy that exporting companies receive, in this case a financial tax subsidy, which is not related to the concept of revenue," concluded the tax expert.
For Katia Gutierrez, a partner at Barcellos Tucunduva Advogados, the decision was the right one because it is not possible to classify IPI credits under the concept of billing.
"Not only that, if we were to allow taxation, we would be neutralizing the intended effect of the credits, which is precisely to relieve exports. This is the main objective intended by the Federal Constitution, which was duly safeguarded by the Supreme Court."
According to Livia Heringer, a lawyer at Ambiel Belfiore Gomes Hanna Advogados, the presumed IPI credits derive from the choice to exempt exports by encouraging them. Thus, the thesis defended by the Treasury would hinder exports and create a burden for companies.
"The STF was unanimous in its view that presumed IPI credits are not part of the calculation basis for cumulative PIS and Cofins. Allowing these credits to be taxed by PIS/Cofins would reduce the tax benefit, making this exemption partial."
The judgment
The rapporteur of the STF's plenary judgment, Justice Luís Roberto Barroso, president of the court, voted against the Federal Government's appeal and was joined by all the other justices. For him, IPI credits do not fit the concept of billing, since they are a tax incentive offered by the Federal Revenue Service with the aim of relieving exports.
"I understand that presumed IPI credits constitute revenue, as new, definitive and positive entries in the assets of the legal entity. This does not mean, however, that these credits fall within the concept of revenue. As we have seen, they consist of a current subsidy, i.e. a tax incentive granted by the tax authorities with a view to exempting exports," said the rapporteur.
For Barroso, the presumed IPI credits are a financial aid provided by the state to the company, "for the purposes of economic support of expenses in carrying out operations related to its corporate purpose".
There was disagreement on the thesis proposed by the rapporteur. According to Justice Edson Fachin, it is the Constitution that prohibits the taxation of export earnings, with the aim of protecting the national product from double taxation.
According to him, the constitutional rule that guarantees tax immunity for export revenues applies both to revenues obtained directly from the sale to the foreigner and to those obtained indirectly through the presumed IPI credit.
"If immunity is allowed for financial income obtained from a private agent, the presumed IPI credit is much more likely to be covered by immunity," said Fachin.
The majority followed Barroso on this point. He was joined by Justices Alexandre de Moraes, Cristiano Zanin, Luiz Fux, Kassio Nunes Marques and Gilmar Mendes. Justices Dias Toffoli, Cármen Lúcia and André Mendonça followed the rapporteur, with Fachin's exceptions.
The thesis was as follows:
Presumed IPI credits, instituted by Law No. 9,363/1996, are not part of the calculation basis for the PIS and COFINS contributions, under the cumulative calculation system (Law No. 9,718/1998), as they do not fit the constitutional concept of billing.
Unburdening the production chain
The IPI presumed credit is a benefit that seeks to relieve the production chain and stimulate the competitiveness of Brazilian companies in the international market. Taxpayers are reimbursed for PIS and Cofins levied on domestic purchases of raw materials, intermediate products and packaging materials used in the production process of goods destined for export.
In the contested ruling, the TRF-4 considered that the credits received by an agricultural equipment company do not constitute income taxable by PIS and Cofins when they are derived from export operations.
The Federal Government argued that the presumed IPI credit falls within the concept of gross revenue and should therefore be included in the calculation basis for PIS and Cofins due by the exporting company.
Source: Conjur