Mato Grosso court prohibits charging ICMS for the solar sector

The Mato Grosso Court ruled this week that the State Government must stop charging ICMS (Tax on the Circulation of Goods and Services) to citizens who produce their own electricity from sunlight. The decision was made by Judge Carlos Roberto Barros de Campos, of the 2nd Public Finance Court of Cuiabá, after the issuance of a writ of mandamus proposed by attorney Ana Oliveira de Almeida Cerqueira.

The agenda was the center of discussions in the Legislative Assembly of Mato Grosso in recent days. In the document, the lawyer claims that the relationship between homes that produce photovoltaic energy and energy distributors does not occur in the form of “merchandise”, but rather as a free loan.

In his decision, Barros de Campos accepted the lawyer's argument and understood that ICMS can only be levied on transactions related to the legal and commercial circulation of goods. In this sense, the tax would not be charged on the production of solar energy, but on the use of the distribution network, since the residences do not have a storage system and the energy only leaves the panels for the network before returning to the homes. Consumption and production are calculated with a bidirectional meter.

Old controversy

A ICMS collection for photovoltaic energy producers It is not new in Brazil and continues to generate discussion today. At the beginning of last month, an energy generation consortium formed by small and medium-sized companies from Pernambuco, for example, was also exempted from paying the tax by the Court, after the State claimed that the passage of energy through the distribution system justified the charge .