Digital Economy Lives a Fiscal Battle
The intense use and development of digital tools is transforming the consumption profile of society and this new profile of consumption has further aggravated the distortions of our tax system
article published in the Diary of the Great ABC
In this scenario, it is concluded that the change in the consumption profile is causing great concern in the States. An emblematic example of this is the unbridled strategy of states to maintain that software is digital goods taxable by ICMS, following a precedent of the STF issued twenty years ago (RE 176.626 / SP) to edit regulatory acts such as ICMS Agreement No. 106/2017. In the aforementioned precedent, the STF classified for tax purposes softwares in two categories: shelf software and softwares to order. Based on this division, the STF understood at the time that software on the shelf would be merchandise, while on-demand software would be the result of providing a service. By the strategy drawn by the States, softwares that are not products of order, are digital goods tributary by ICMS. </ Div>
I emphasize that when the facts analyzed by the Supreme Court in RE 176.626 / SP even made sense the aforementioned distinction, since at that time there was no regulation of the matter and little was known about the software market. With the advent of the Software Law (No. 9.609 / 98), the Intellectual Property Law (No. 9.610 / 98) and Complementary Law No. 116/03, this distinction completely lost its meaning because such Laws disciplined the software market and established , without distinguishing software from the shelf and order, that licensing or assignment of right of use of computer programs is taxable by the ISS and not by the ICMS (item 1.05 of Complementary Law 116/03).
This is just one of many examples that could be cited to demonstrate that, in the end, it is always the taxpayer and the citizen who bear the cost of distortions and the whole inefficiency of the national tax system. There are good initiatives for a deep and necessary tax reform – there are dozens of good tax reform projects being processed in the National Congress. What is lacking is motivation and political mobilization for ongoing tax reform projects to move forward and be discussed seriously and swiftly.
Leonardo Milanez Villela – Tax lawyer, partner of Correia da Silva Advogados