On 02/08/2023, the Federal Supreme Court - STF decided, unanimously, on the judgment of Extraordinary Appeals ns. 949,297 and 955,227 – Items 881 and 885 of the General Repercussion, which discusses the limits of res judicata in tax matters, for cases in which the STF subsequently takes a contrary position, in terms of concentrated and diffuse control of constitutionality, respectively.

Therefore, if the taxpayer has a final favorable judicial decision allowing the non-payment of the Social Contribution on Net Income - CSLL, with a new understanding of the STF on the subject, the res judicata will cease its effects automatically.

The thesis is the following (Free translation):

"1. The decisions of the STF in incidental control of constitutionality, prior to the institution of the regime of general repercussion, do not automatically impact the res judicata that has been formed, even for ongoing tax relations.

2. Decisions issued in direct action or with general repercussions automatically interrupt the temporal effects of final decisions in the aforementioned relations, respecting non-retroactivity, annual precedence, and ninety days precedence, depending on the nature of the tax”.

In other words, the new STF understanding is immediately applicable, regardless of any judicial questioning, such as a revision action.

One of the Federal Government’s arguments to justify the charge is that, with the STF decision, there is a rule of the law change. That is, the STF jurisprudence changes imply a loss of res judicata effects.

Under article 505, item I, of the Civil Procedure Code, no judge will decide again on issues that have already been decided on the same dispute, except “if, in the case of an ongoing legal relationship, there has been a change in the facts or legal status, in which the party may ask for a revision of what was established in the sentence”. (Free translation)

By interpreting the rule, the Supreme Court ends up overturning the final judgment’s legal foundation.

However, the request for modulation of the effects of the decision to take effect from the publication of the trial minutes, made by the taxpayers, was not accepted.

Therefore, in practice, taxpayers must pay the CSLL as of 2007, the date on which the constitutionality of the contribution was recognized by the Supreme Court - ADI 15. However, the non-retroactivity principle was respected, as well as annual and the prohibition against instituting tax changes before 90 days period, depending on the nature of the tax.

In fact, with the STF decision, the Federal Government began to charge all taxpayers with CSLL, even those who had already won the right to withdraw from the contribution in the court, with a final decision.

Taxpayers with final decisions have already reported tax assessments by the Federal Revenue Office - RFB for the collection of CSLL.

The decision is subject to criticism since it affects the legal certainty. It is important to point out that article 5, item XXXVI, of the Federal Constitution, provides that “the law shall not prejudice the acquired right, the perfectly legal act and the res judicata". (Free translation)

Taxation is a legal ongoing obligation. Therefore, despite the possibility of a change of understanding by the STF, the stability of the obligations should have been minimally observed.

If you have any questions, please do not hesitate to contact our tax team.