Low-Value Tax Executions can be extinguished if alternative measures for credit collection are not adopted


The Brazilian Supreme Federal Court, when analyzing R.E 1.355.208 in the context of a general repercussion, allowed for the extinction of low-value tax executions. According to the judgment, the initiation of tax executions will depend on prior adoption of measures such as reconciliation attempts and protest, aiming to offer alternatives to the handling of low-value cases that end up overburdening the judicial system.

Minister Cármen Lúcia, the rapporteur of the case, emphasized the importance of exploring alternative collection methods, such as protest at the notary’s office, to prevent disputes involving low-value debts from consuming precious judicial resources. The minister also highlighted that Law No. 12,767 of 2012 authorizes the Union, States, Federal District, municipalities, and autarchies to protest certificates of active debt in order to recover their credits.

To alleviate this situation, the Supreme Court’s decision establishes that the initiation of tax execution requires the prior adoption of alternative measures, such as reconciliation attempts or administrative solutions, and the protest of the title. An exception is only made for reasons of administrative efficiency, provided that the inadequacy of alternative measures is proven. Additionally, the decision allows the federated entities to request the suspension of proceedings to adopt these measures, informing the judge of the deadline.

There is no doubt that the Supreme Court’s decision represents a significant step towards improving the efficiency of the Brazilian judicial system, reducing the burden of low-value tax execution cases, as they represent a significant portion of ongoing cases in the courts, and offering alternatives for debt collection in a more effective and fair manner, as only a small percentage of tax executions reach a satisfactory conclusion.


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