Electricity energy distributors have obtaining favorable preliminary injunctions decisions in court to collect the ICMS only in amounts due by customers when paying their electricity bills. There are already favorable decisions for Energisa Sul-Sudeste, Paraná’s electricity distributor, and Energisa Paraíba.

As a rule, because of the tax substitution regime, concessionaires must pay the ICMS regardless of the payment of invoices due by customers. This year, in view of the decree of the state of national public calamity until December 31^st and Resolution No. 878 of Aneel, the distributors are obliged to supply electricity even in case of lack of payment, due to the pandemic of COVID 19.

The requests made by the taxpayers in the cases under analysis were based on the principle of proportionality and contributory capacity of the legal entities, under the understanding that the measures taken by Aneel impose a significant loss on the companies. In this sense, there would have a violation on the principle of contributory capacity insofar as there is an imposition of disproportionate exaction to the resources received by the companies, representing confiscation.

In addition, there would also be an economic imbalance of the contract, as, added to the fact that there is no financial consideration due to the supply of electricity, the companies end up collecting taxes due to invoicing, without being able to use coercive means for their performance, generating undue tax burden on the consumption chain.

This is a controversial discussion and may still be reviewed by the higher courts and finally in general repercussion in the Supreme Federal Court, when the judgment of ARE No. 668,974 (which deals with a similar situation, dealing with the ICMS credit right paid, in the substitution regime telecommunications companies).

Our team is available to assist in this and other tax law issues. For further information please contact our Tax Team by the following e-mails: rmarques@zaslaw.com.br or zaslaw@zaslaw.com.br