Injunction suspends collection of ICMS


By Renée Pereira, The State of S. Paulo - 03/03/2005

The fuel sector was once again surprised by an injunction suspending the collection of ICMS at the refinery. The decision - granted by Judge Maria do Céu Cabral, of the 2nd Civil Chamber of the Court of Justice of the State of Pará - authorizes the companies Arrows and Gold, represented by Combusforte, to withdraw at the Manguinhos refineries in Rio de Janeiro, and Replan, in São Paulo, 36 million liters of fuel, without paying ICMS, to sell in Pará.

According to the legal director of the National Union of Fuel and Lubricant Distribution Companies (Sindicom), Guido Silveira, the decision interrupts a period of one and a half years without any injunction for this purpose. "This is an old discussion about when to pay the tax, whether at the refinery or when the fuel is sold to the final consumer," he explains.

The chief prosecutor of the São Paulo State Tax Attorney, Clayton Eduardo Prado, argues that the problem is knowing where the fuel will be sold. In his opinion, in the specific case of Pará, it is economically unfeasible to buy fuel in São Paulo or Rio de Janeiro and take it to the State. “Therefore, there is a strong suspicion that this fuel does not even leave the region. That is, they would be disguising a tax evasion. ”

According to Silveira, after leaving the refinery, fuel will be lost and no state will receive the tax. They can, for example, say that they sold the product to another distributor, getting rid of tax liability, he explains. “Therefore, if the decision is not overturned, I insist on monitoring the withdrawal and exit of fuel from the State of São Paulo,” says Prado.

According to the court decision, Arrows will be able to buy, without collecting ICMS, 10 million liters of gasoline and 5 million liters of diesel oil per month. Gold will be able to remove 18 million liters of gasoline and 3 million liters of diesel oil monthly. Although the decision was granted on February 25, companies will only be able to withdraw fuel when the precatory letters arrive in the States.

The São Paulo State Finance Secretariat, however, will not allow the operation to take place, said the agency's deputy director, Eribelto Rangel. "This decision cannot be applied to the State of São Paulo, as the companies involved are in São Paulo territory."