The year 2020 will be marked not only by the pandemic, but by the speed with which the organs of public administration have adapted to the new reality of social distancing. The Administrative Council of Tax Appeals (Carf), the body responsible for the trial of federal tax administrative proceedings, also had to adapt to the new non-face-to-face format.
For the council, the year 2020 began with the prospect of a new internal rules, including the possibility of society giving an opinion in the draft following the transparency passed on by Carf, through a public consultation.
However, the placement of a new regiment was in the background, since the pandemic forced the body to concentrate its efforts on maintaining the trial activity in the period of social distancing.
In March, with the stoppage of face-to-face sessions, the Ministry of Economy published Ordinance Carf No. 10,786/20, instituting non-face-to-face trial sessions for administrative processes involving: (i) historical values of up to R$ 1 million; or (ii) matter subject to the summary or resolution of Carf or, furthermore, decisions finalized by the Supreme Court or the Supreme Court given in the system of the general repercussion or repetitive appeals. Until then, the possibility of virtual sessions existed only for the trial of cases below 60 minimum wages, and, in such cases, without the possibility of oral support or participation of interested parties.
For this new trial model, Carf implemented new systems for virtual sessions, enabling oral support or real-time monitoring of judgment. And in order to check the publicity of the trials, the sessions are later made available to the public on YouTube.
Some say that virtual sessions surround the taxpayer's right of defense, claiming that prerogatives concerning trials in face-to-face sessions have been mitigated. However, it seems to us that Carf is trying, to the fullest, to minimize any harm that virtual judgment can bring to taxpayers.
With the implementation of non-face-to-face sessions, the departing of requests for removal of the agenda was made flexible, for later reinclusion when the session resumes in person, being another attempt by the agency to reduce any damage that virtual sessions can bring to the parties. Carf also made it possible to hold virtual hearings, for the order of interested parties with the rapporteur of the administrative procedure, which confirms the commitment of the body to maintain satisfactory judicial provision.
On August 14, 2020, with the reduction of the number of lower-value cases, Carf published Ordinance No. 19,366/20, increasing the amount of jurisdiction to R$ 8 million and allowing several other cases to be brought to trial.
A few months after the establishment of non-face-to-face sessions, the results have already begun to appear. The president of the body, Counselor Adriana Gomes Rêgo, mentioned at the VI Carf Seminar on Tax and Customs Law that, surprisingly, compared to 2019, the year was marked by a significant increase in the number of trials – 55% more in the months of June to October.
The period was also distinguished by the extinction of the quality vote, with the publication of Law No. 13,988/20, which in its art. 28 determines, in case of a tie in the judgment of the tax credit requirement, the solution of the issue in a favorable way to the taxpayer.
After controversial discussions about its applicability and extension, the Ministry of Economy issued Ordinance No. 260/20 to regulate the new provision, clarifying that the extinction of the quality vote would only apply to processes that discuss the requirement of tax credit through infraction notice or notification of release. Under the ordinance, the new provision will not apply to procedural discussions, judgment of declaration embargoes or other kinds of processes within Carf's jurisdiction.
Despite the regulation by the Ministry of Economy, the discussion on the extinction of the quality vote extended to the Supreme Court. Direct actions of unconstitutionality are being filed in the high court questioning the legislative process that resulted in the publication of Law No. 13,988/20. Until the closing of this article, the Supreme Court had not yet ruled on the merits of the issue.
While 2020 was the year of adaptations in the agency, the expectation is that 2021 will be consolidation, maintaining pace and judgment models, at least until a safer phase of the pandemic is reached. Virtual trial sessions, at least until the completion of the national vaccination plan, must follow.
And given the performance figures mentioned here, the agency's promise to continue implementing measures to optimize virtual judgment is already being fulfilled this early in the year.
In January, Ordinance Carf/ME no. 690/21 was published, which raised the amount of jurisdiction for virtual judgment of administrative proceedings to R$ 12 million, in addition to providing for the possibility of judging representations of nullity also virtually.
This increasing increase in jurisdiction values – from R$ 1 million to R$ 8 million and, in 2021, to R$ 12 million – indicates the reduction in the number of lower-value cases and the body's interest in increasing the percentages of trial of cases.
It is not yet known what Carf's next steps will be throughout the year. The resumption of the renewal of the bylaws, after public consultation, is of great interest to taxpayers, who also yearn for a modernisation of the platforms for the transmission of the sessions and the system for monitoring administrative processes itself.
Given the significant increase in the number of judgments in virtual sessions, Carf is expected to establish, definitively, a mixed regime of judgment of administrative processes, granting taxpayers the opportunity to choose the modality of judging their cases.