News

The 1st Section of the Brazilian Superior Court of Justice (STJ), in ruling on Special Appeals No. 2,175,094/SP and No. 2,213,551/SP – submitted under Theme 1371 of the representative appeals system – recognized the possibility for state tax authorities to assess (arbitrate) the calculation base of the Tax on Inheritance and Donations (ITCMD) when they disagree with the value attributed to the asset by the taxpayer.

However, such assessment must be carried out through a proper administrative proceeding, observing due process, adversarial proceedings, and fair hearing rights. It must also be supported by evidence demonstrating that the declared value significantly deviates from market value. As this thesis was established under the representative appeals system, it is binding upon lower courts.

The decision was reached by the majority during the session held on December 10, following the dissenting opinion of Justice Marco Aurélio Bellizze, who was joined by six other justices. Justice Maria Thereza de Assis Moura dissented, arguing that the STJ lacked jurisdiction to rule on the matter, as it did not involve federal law.

On the merits, the Court examined whether the São Paulo tax authority’s prerogative to assess the ITCMD tax base derives from the National Tax Code or exclusively from state legislation. According to Justice Bellizze, Article 148 of the National Tax Code authorizes such assessment when the taxpayer’s chosen criteria prove inadequate, provided procedural guarantees are respected.

The procedure should only be initiated when the information provided is insufficient or unreliable, and it is for the tax authority to demonstrate a significant discrepancy between the declared value and the market value. Link do site: BRZ Advogado