On May 18, 2023, an appellate decision was published in which the Federal Supreme Court (STF) unanimously decided that the isolated fine of 50% (fifty percent) of the amount of the debt demanded from taxpayers, for disregarding the offsetting of credits not accepted by the IRS, was declared unconstitutional.
According to the rapporteur, Edson Fachin, the fine is unconstitutional “because it does not consist of an unlawful act capable of triggering an automatic penalty”.
The 50% fine was established in 2010 by Law 12,249 and, based on it, the tax authorities charged the aforementioned punitive fine, in addition to a late payment fine of up to 20%, plus Selic interest.
The decision was handed down by the Federal Supreme Court’s Full Bench, when it considered theme 736, with general repercussion and establishing the following thesis: “The isolated fine provided for by law to be levied in the event of a mere refusal to homologate a tax offset is unconstitutional, as it does not consist of an illicit act capable of automatically triggering a pecuniary penalty”.
From now on, the tax authorities will not be able to levy the 50% fine when they do not grant a request for reimbursement and do not approve statements of offsetting credits before the IRS. As a result, all current cases must be ruled in favor of taxpayers.