Since 2014, there was already a law that established that late payment interest generated by the delay of the tax administration was not valid.
On the 8th of this month, the Constitutional Court published a new binding precedent regarding tax processes and indicated that default interest should not be applied to tax debts if the delay that generated this interest was due to the delay of the Sunat or the Tax Court and, furthermore, it indicated that default interest would not be generated while the process for the payment of taxes is judicialized.
The sentence has been the subject of much discussion and the Sunat has even demanded its annulment. The former economy minister, Luis Arias, has even assured that this measure is like a “debt forgiveness.”
The legal response
“Forgiveness is a means of extinction of obligations (…), leaving the debtor free from payment of the obligation,” explains Percy Bardales, litigation partner at EY Peru, who points out that for this to occur in relation to tax debts, the extinction must occur by means of a law or norm with the force of law.
In that sense, strictly speaking, the resolution of the TC would not be a remission, since it is only resolving a specific case based on other criteria already used previously by the same Court.
“In other words, we are only faced with the establishment of a criterion, as binding, to generate legal certainty and confidence in the country,” emphasizes the lawyer.
What is left to pay?
But, at the end of the day, the judgment of the TC would be leaving aside the payment of large amounts in favor of the Sunat for a number of taxpayers so, beyond the technicalities, is this not a remission?
As Bardales explains, the answer is no, since what is being discussed in the judiciary and in the Constitutional Court are not tax debts, but the additional payments established by Sunat on which there is no consent.
In other words, the taxes not paid by a company in a year are not discussed, but rather the interest or fines applied in a questionable manner by the administration. The debt capital is not affected by these processes.
In that sense, are we dealing with a pardon-like effect? No, since a cancellation forgives a recognized debt that is firm, not additional payments requested by the Sunat and that are in dispute.
Looking at it from a criminal angle, saying that the debt that is the subject of the dispute is being forgiven would be like saying that a person who has recently been charged before the prosecution is being forgiven years in prison.
Just as there is no conviction for a person who does not yet have a criminal sentence against him, there is also no debt to pay.
Likewise, Raúl Odría, partner of the Jamis Dalguerre Abogados law firm, indicated that the amounts that Sunat wanted to collect had been calculated illegally.
“The Sunat knew perfectly well that the Tax Code says that you have 12 months to resolve taxpayer claims and it has taken more than 9 years in many cases. They should have known that these interests were always illegally calculated”, explains the lawyer.
“There is no logic or criteria of justice that you charge interest for that time if it took you 9 years to resolve,” he adds.
The position of the TC is not new
In addition, Odría emphasizes that this sentence says the same thing that a number of past resolutions have said, so the position of the TC is not really new.
“There have already been numerous individual sentences that have indicated the same criteria that the sentence questioned by Sunat now indicates. What has been done now is to issue a general judgment, applicable to everyone without exception, to small as well as large taxpayers”, he emphasizes in this regard.
In this sense, Odría emphasizes that Sunat is wrong to make it appear that this only applies to “big companies”, since it is a transversal statement that has an impact on all taxpayers.
The position of the TC was already in the law
Despite the fact that the TC ruling has been controversial, it should be noted that the position contained in the ruling was already in the Peruvian legal system for a long time.
In 2014, Law 30230 was published, which established that default interest could not be generated if the delay that generated this interest was due to the slowness of the tax administration.
“By virtue of this law, the generation of default interest was suspended from the expiration of the maximum term to resolve provided in Article 150 of the CT, which regulates the appeal in tax matters,” explains Bardales.
In other words, the position that establishes that the delay of the Sunat or the Tax Court should not generate late payment interest against the taxpayer is already in the law since 2014.
What the Court has now said is that this criterion also applies to cases initiated prior to 2014.
Would it impact public finances?
On the other hand, the Ministry of Economy has stressed that the ruling of the Constitutional Court “is a measure that has a negative impact on the country’s public finances.” However, Odría points out that this would not be the case.
“As we mentioned, the TC had already resolved a number of cases where it had agreed with the taxpayer, saying that the Sunat charges were illegal, so if the Sunat informed the MEF that it was money that was part of of his assets, the Ministry has been giving him incorrect information. It is, at best, a contingent asset,” he comments.