The First Section of the Superior Court of Justice (STJ) recognized, on April 9, under the rite of repetitive judgments (Topic 1,247), the right to taxpayer to hold the IPI tax credit originated by the acquisition of inputs used in the industrialization process, even in outflows of final products non-taxed by the IPI (NT), including immune ones, provided for in article 155, paragraph 3, of the Federal Constitution of 1988.

The decision, taken format unanimous by the First Section of the STJ, put an end to a debate that had lasted for more than 20 years in the country's courts about the scope of article 11 of Law 9,779/99 –  a subject already addressed by us in another article.

The aforementioned provision provides for the "possibility of crediting the IPI resulting from the acquisition of raw material, intermediate goods and packing material, applied in industrialization, including a product exempt or taxed on the zero rate".

In the understanding of the tax authorities, provided for in the Interpretative Declaratory Act SRF 5/06 (ADI SRF 5/06), the maintenance of the IPI tax credit would not be allowed, when the inputs were applied in final products under NT notation (not taxed), due to the lack of a legal provision. This is because article 11 of Law 9,779/99 does not expressly mention non-taxed final products. The provision refers only to products exempt or taxed at the zero rated.

On the other hand, taxpayers argued that, jointly with the enactment of Law 9,779/99, the right to maintain the IPI tax credit in the acquisition of inputs used for the manufacturing of final products exempt from the tax, including the immune one, became legitimate.

Within the scope of the Tax Appeals Administration Council (Carf), there were, initially, some occasions in which the right to maintain the IPI tax credit in exempt tax exits, including immune products, was recognized:

"IPI. REIMBURSEMENT CREDIT RAW MATERIAL, INTERMEDIATE PRODUCT AND PACKAGING MATERIAL. IMMUNE PRODUCT. The products included in the TIPI as non-taxable by virtue of constitutional immunity and that are not excluded from the concept of industrialization of article 3 of RIPI/98 must enjoy the right to reimbursement of credits related to the inputs used in the production process, as provided for in article 11 of Law No. 9,779/99. Appeal granted in parties."

However, after the establishment of the issue in Carf Precedent 20, the right to maintain the IPI tax credit in unencumbered exits had been recognized only in the case of exits destined for offshore remittances:

"There is no right to IPI credits in relation to the acquisition of inputs applied in the manufacturing of products classified in the TIPI as NT."

As the Federal Supreme Court (STF) decided that the discussion on the possibility of maintaining the credit provided for in Law 9,779/99 would be of an infra-constitutional order, it was up to the STJ to have the final word on the matter.

In the first judgment, without a binding nature, the 1st Section of the STJ, had already manifested, by majority, for the possibility of crediting IPI on the sale of non-taxed final products, including those immune:

"CIVIL AND TAX PROCEDURE. MOTION FOR CLARIFICATION OF DIVERGENCE IN SPECIAL APPEAL. CODE OF CIVIL PROCEDURE OF 2015. APPLICABILITY. TAX ON INDUSTRIALIZED PRODUCTS – IPI. GRANTING OF CREDIT THROUGH ARTICLE 11 OF LAW NO. 9,779/1999. AUTONOMOUS CREDITING. DISENGAGEMENT FROM THE RULE OF NON-CUMULATIVENESS – DISTINGUISHING. USE OF THE IPI CREDIT BALANCE IN THE UNFEASIBILITY OF OFFSETTING WITH THE AFOREMENTIONED TAX LEVIED ON THE EXIT. HYPOTHESIS OF NON-TAXED PRODUCT. POSSIBILITY".

More recently, this issue was assigned to the rite of repetitive appeals by the 1st Section of the Superior Court of Justice.

The leading cases were REsp 1976618/RJ and REsp 1995220/RJ, distributed to the rapporteur of the minister Marco Aurélio Belizze, who recognized the right to maintain the IPI tax credit on the output of tax-exempt products (NT), including those immune. The minister reporter was unanimously followed by the other ministers who make up the 1st Section of the STJ.

After the debate between the justices of the 1st Section, the following thesis was established:

"The IPI credit, established in article 11 of Law No. 9,779/1999, resulting from the taxed acquisition of raw material, intermediate goods and packing material used in industrialization, covers the output of exempt products, subject to the zero rated and immune."

Considering its binding nature, the STJ's decision must be mandatorily replicated by the other courts in the country, acknowledged and agreed with article 1,040 of the CPC/15.

It is worth noting that the binding effect of this recent decision of the 1st Section of the STJ also applies to judgments that may be carried out by Carf, as provided for in article 99 of the internal regulations of this collegiate body. Thus, very soon Carf Precedent 20 should be revoked, so that Carf can adapt its jurisprudence to what is determined by Topic 1,247.

Machado Meyer's tax practice is available to provide more information never plural about the implications of the decision commented on in this article.