Vale: Judgment of R $ 22 billion on profit tax is suspended with a request for a view

Minister Alexandre de Moraes of the Federal Supreme Court (STF) voted in favor of the incidence of legal entity income tax (IRPJ) and social contribution on net income (CSLL) on the profits obtained abroad by subsidiaries and coalitions of Brazilian companies. With this, the score was 2-1 in favor of the Union. The trial had been resumed on the morning of Friday, 7, and was already suspended by the request for view of Minister Kássio Nunes Marques.

The specific case, which deals with Vale (Vale3) subsidiaries in Denmark, Belgium and Luxembourg, puts in dispute $ 22 billion, according to the IRS estimated.

The amount includes a year of non -payment and the return of taxes for the last five years.

“There is no conflict between Brazilian law, more specifically the taxation provided for in the

Art. 74 of MP 2.158-35/2001, and international treaties. The Brazilian standard reflects the equity increase of the controlling company resident in Brazil, without violating the limits of treaties, which intend to avoid the double legal tax exclusively, not taxation resulting from different economic situations, ”said Moraes in his vote. He followed the current opened by Minister Gilmar Mendes, who diverges from the rapporteur, André Mendonça.

The action has no general repercussion, that is, the result should not be automatically followed by the lower instances in similar processes. But the case is concerned with the Union because it can change the jurisprudence of the Supreme, which has been favorable to the Union since 2013. Broadcast (Real -Time Staff News System) has found that about 40 actions in court on the subject.

According to February 2023 revenue note, the consequences of this trial, in case of unfavorable outcome to the Union, can have an impact of R $ 142 5 billion, taking into account 2017 to 2021, and R $ 28.5 billion future future.

The Court discusses whether Article 7 of treaties signed by Brazil with other countries to avoid taxures prevents the IRPJ and CSLL revenue on profits earned by subsidiaries of Brazilian companies located in foreign territory. The treaties state that profits must be taxed in the country’s location country, unless there is a permanent establishment in Brazil.