The Brazilian Supreme Court (“STF”) has initiated the trials of Themes 881 and 885, which will decide matters related to the disregarding of res judicata on decisions obtained by taxpayers, impacting tax relations of continued payment of CSLL (Social Contribution on Profits).

In both cases, the reporting STF judge understood that new STF decisions that change previous understandings, both in cases of concentrated and diffuse control, cease the effects of res judicata in tax matters regarding taxes paid on a continuous basis. For these STF judges, the break is automatic, and it is not necessary for the Federal Government to file a revisional or rescissory lawsuit questioning the issue. In other words, companies that did not pay CSLL because of a final and unappealable decision will have to begin paying this tax now, if the understanding of the panelists is confirmed.

In Theme 881 (RE 949.297), reported by judge Edson Fachin, the matter is whether a decision by the STF in the so-called concentrated or abstract control – for example, in the judgment of an ADI, ADO or ADC – automatically breaks the res judicata of decisions by judges in diffuse or incidental control.

Theme 885 (RE 955.227), reported by judge Luís Roberto Barroso, will analyze whether the STF’s decisions under diffuse (and not concentrated) control – for example, in the judgment of an Extraordinary Appeal – cease the future effects of res judicata in tax matters. That is, whether they break the res judicata of previous decisions that found a tax to be constitutional or unconstitutional.

In addition, the justices have already voted to modulate the effects of the decisions, so that they are effective as of the minutes of the judgment of the two appeals.