The Ministry of Finance is regulating tax transactions by adhesion in tax litigation involving significant and widespread legal controversy and small-value claims, following changes introduced by Law 14,689 of September 20, 2023. The proposal for negotiations to regularize these types of tax debts is aimed at individuals and legal entities, and its rules will be detailed in notices issued by the Brazilian Federal Revenue Service (RFB) and the Attorney General's Office of the National Treasury (PGFN), as provided for in Normative Ordinance 1,584 of December 13, 2023, published in the Federal Official Gazette on Thursday (12/14). Notices are expected to begin being published on the RFB website, the PGFN website, and the Ministry of Finance (MF) website in December.
The objectives of the transaction are to promote the consensual resolution of administrative or judicial disputes through reciprocal concessions; to extinguish administrative or judicial disputes already instituted over a given legal controversy, relevant and widespread; to reduce the number of administrative or judicial disputes and their inherent costs; to establish a new paradigm for the relationship between the tax administration and taxpayers, prioritizing dialogue and the adoption of appropriate means of dispute resolution; and to encourage self-regulation and tax compliance.
Innovation
“Ordinance 1,584 innovates the concept of transaction,” says tax auditor Gustavo Manrique, general coordinator of Tax Credit Administration at the RFB. He makes special mention of the changes to tax transactions brought about by Law 14,689 of September 20, 2023, which introduced improvements to this model for negotiating debts with the federal tax authorities.
Among the new developments related to tax litigation of significant and widespread controversy is the new discount limit of 65% on reductions or concessions on the total value of the credit (including on the principal amount), with a maximum repayment term of 120 months. In transactions involving individuals, microenterprises or small businesses, the maximum reduction provided for may be up to 70% of the total value of the credit, and the repayment term may be up to 145 months.
The new provision also includes the use of tax losses from Corporate Income Tax (IRPJ) and the calculation basis for Social Contribution on Net Income (CSLL), in an exceptional manner, to settle the debt, as well as the possibility or not of the taxpayer conforming to the understanding of the tax administration regarding future or unconsummated taxable events. In small-value tax litigation, the provision is that the notice may grant discounts (including on the principal amount) of up to 50% of the total value of the credit, with a payment term of up to 60 months.
Gustavo Manrique emphasizes that Ordinance 1,584 meets the objective of the RFB and the Ministry of Finance to increase legal certainty to reduce tax litigation and, consequently, to build a more predictable and, therefore, attractive business environment.
The general coordinator highlights, in the context of the design of the planned notices, the importance of the public consultation held from November 6 to 17, in which the thesis of the incidence of IRPJ and CSLL on profits obtained by Brazilian companies from their business abroad was discussed. “The public consultations,” emphasizes Gustavo Manrique, “have as their main purpose to bring the Federal Revenue Service closer to society.”
He concludes by stating that this year, the publication of notices of adhesion transactions in tax litigation involving relevant and widespread legal controversy will begin, and a communication channel will be opened at the RFB for society to suggest new theses for tax transaction purposes.
Understand the modalities
The controversy considered widespread occurs when it is found, alternatively, the existence of legal claims involving different parties and lawyers, in progress within the scope of at least three Federal Regional Courts; more than 50 legal or administrative proceedings referring to different taxpayers; incident of resolution of repetitive claims, whose admissibility has been recognized by the processing Court; or legal or administrative claims that involve a significant portion of the taxpayers belonging to a certain economic or productive sector.
The relevance of a controversy is demonstrated when there is, alternatively, an economic impact equal to or greater than R$1 billion, considering all known pending judicial and administrative proceedings; divergent decisions between the ordinary panels and the Superior Chamber of the Administrative Council of Tax Appeals (Carf); or divergent sentences or judgments on the merits within the scope of judicial litigation.
Small-value tax litigation is that in which the amount of the debt registered in active debt or in tax assessment under discussion (including principal amount and fine) does not exceed, through administrative or judicial proceedings, the amount corresponding to 60 minimum wages; and which has as passive subject a natural person, micro-enterprise or small business.
Source: Federal Revenue
