The Supreme Federal Court (STF), unanimously, decided that the qualified fine applied in cases of fraud, tax evasion, or collusion must be limited to 100% of the tax debt, potentially reaching 150% in cases of recidivism, as established by Extraordinary Appeal (RE) 736090, Topic 863. This decision is based on the recent Law 14.689/2023, which adjusted the levels of fines at the federal level, reducing the qualified fine from 150% to 100%.
The position of the rapporteur, Justice Dias Toffoli, prevailed in extending the application of the qualified fine limits to states and municipalities until a federal supplementary law is enacted to regulate the matter uniformly across the national territory. In practice, this means that, from the effective date of Law 14.689/2023, subnational entities may not impose fines exceeding 100% of the debt, except in cases of recidivism, where the rate can reach 150%.
Established Thesis and Modulation of Effects
The STF established the following thesis: “Until a federal supplementary law on the subject is enacted, the qualified tax fine for evasion, fraud, or collusion is limited to 100% of the tax debt, and may reach up to 150% in cases of recidivism.”
Additionally, the justices modulated the effects of the decision from the effective date of Law 14.689/2023, which is September 21, 2023. Therefore, taxpayers who paid fines exceeding the 100% cap after this date may seek the return of amounts paid in excess, provided they had not previously litigated the issue judicially or administratively before the enactment of the law.
It is important to note that the modulation of effects preserves the rights of taxpayers who had already filed lawsuits before the new law was issued. Thus, those who were challenging fines above 100% before Law 14.689/2023 will also be entitled to the benefits.
Impact on States and Municipalities
The STF’s decision does not affect the Union, as the reduction of the fine to 100% has been in force at the federal level since the publication of Law 14.689/2023. However, for states and municipalities, the decision imposes a limit that prevents the application of disproportionate fines, harmonizing tax treatment at the national level until a supplementary law is enacted.
However, Justice Flávio Dino raised concerns about the possibility of a “fiscal war,” suggesting that states could set fines lower than the established ceiling. To avoid distortions, the STF concluded that, even in entities where the qualified fine is lower than 100%, states and municipalities will not be able to reduce their punitive rates and must respect the limits now established.