3/30/2020
The 1st Panel of the Superior Court of Justice (STJ) has recently set the maximum amount of the base to be used when calculating non-tax contributions – such as the S System and Incra contributions – at 20 minimum wages. The ruling was given on Appeal Case No. 1570980/SP.
This STJ ruling found that a law enacted in 1981, Law No. 6,950, set the same limit for both Social Security payments and non-tax contributions. The limit was 20 minimum wages.
The STJ Justices also took into account a decree enacted in 1986 (Decree No. 2,318), which changed the base for Social Security contributions, but made no reference to non-tax contributions. Because the decree provided for social security contributions alone, the limit set by the 1981 Law is still applicable to non-tax contributions.
The STJ ruling is a major decision for taxpayers because it means that companies may have calculated non-tax contributions incorrectly and paid them in excess if compared to the amounts that would be payable based on the STJ ruling.
Thus, there is good chance for companies to recover in court the amounts paid in excess during the past years.
Our tax practice team is ready to provide guidance and further information on this topic.
