The First Panel of the Brazilian Supreme Federal Court (STF) has formed a majority to reject the State of São Paulo’s attempt to levy ITCMD (Tax on Inheritance and Donations) on donations made by donors residing abroad. Justices Cármen Lúcia, Cristiano Zanin, and Alexandre de Moraes ruled that such taxation can occur only after the enactment of a new state law, since the previous legislation was declared unconstitutional by the Court itself. The ruling refers to a specific case and does not automatically apply to other actions on the same issue. Justices Luiz Fux and Flávio Dino have yet to cast their votes.
Our Tax and Wealth Management partner, Gabriel Paranaguá, comments: “State rules that existed before the constitutional amendment and lack support from a complementary law do not become ‘constitutional’ by default.”
Read the full article, published by Folha de S. Paulo (available to subscribers only) here.
