EN 
PT_BR 
The STF (Supreme Federal Court) voted on Monday night (22) in favor of prohibiting the higher rate of ICMS (Tax on Circulation of Goods and Services) charged by Brazilian states on electricity and telecommunications services.
The decision taken involved the action filed by Lojas Americanas against the ICMS rate of 25% charged by the state of Santa Catarina.
The retail company questioned the higher percentage of the rate, as it considered electricity and telecommunications as essential services. The Santa Catarina government charges a tax rate of 17%, a lower rate, from other sectors.
The ministers considered the charge unconstitutional. “The rates on electricity operations and telecommunications services differ from the constitutional standard at a higher level than operations in general, considering the essentiality of goods and services”, said minister Marco Aurélio, rapporteur of the case and now retired, in the vote that It happened in February – when the trial of the action began.
The decision on Lojas Americanas' action has a wider repercussion, as the STF's understanding must be taken to similar cases in the country, and other states that charge a higher ICMS rate may be forced to reduce the value of electricity bills, telephone and internet.
“With the decision, it is expected that the states will adapt their respective internal legislation, reducing the ICMS percentage on energy”, explains Einar Tribuci, lawyer specializing in tax law and tax director at ABGD (Brazilian Association of Distributed Generation).
“Energy is an essential good, and today rates similar to cigarettes and alcoholic beverages have been charged, which is, to say the least, absurd”, adds Tribuci. But even in light of the new decision, the lawyer reinforces that the reduction may take time to enter the population's account.
“Taxpayers who are electro-intensive and who are charged with ICMS higher than the rate of 17-18% are recommended to immediately file an action based on the STF decision (topic 745), as it is not possible to say that the States will change this issue in short term, and that it is actually quite normal for them to purposely delay this type of issue that reduces revenue from the public coffers”, he adds.
For the electricity sector, the decision is significant, says Tribuci. “It proves to be important as the ICMS charged on energy until then followed the same logic as energy supply, in which there is no option. Either you pay, or you pay to have access to energy. As the ICMS is included in the price, we consumers always pay without question.”
STF vote
The STF decided against the higher ICMS rate considering that it violates the principle of essentiality, provided for in the Constitution. According to him, lower tax rates should be allocated to goods and services essential to society.
All 11 ministers voted against the charge for the telecommunications sector, considering the principle of essentiality. Regarding electricity, the vote was 8 to 3.
Ministers Marco Aurélio, Dias Toffoli, Cármen Lúcia, Ricardo Lewandowski, Edson Fachin, Rosa Weber, Luiz Fux and Nunes Marques voted against the electricity tax.
Alexandre de Moraes, Gilmar Mendes and Luís Roberto Barroso voted in favor, as, according to them, there are different rates depending on the consumer's ability to pay.
One Response
Yellow and red tariffs are a lack of planning and adverse weather conditions. Using them as a device to increase taxes is yet another act of evil on the part of those in power. Therefore, the maximum limit of 17% could only apply to the green tariff values.