The Supreme Court of Justice of the Nation emphasizes the concept of municipal fees.

Towards greater uncertainty and tax pressure.

The ruling that the Supreme Court of Justice of the Nation has just issued 2.9.2021 in the case “ESSO Petrolera Argentina S.R.L. and another c/ municipality of Quilmes s/ administrative contentious action ”. We attend the confirmation of a recalification of the concept of municipal rates and the tax power of the municipalities of the country.

The discussion issue dealt with: a) The right of municipalities to apply municipal fees (in the case the safety and hygiene inspection rate) calculated not on the basis of the service provided but on the tax on provincial gross income. B) The right of the taxpayer to the amount of the rate is proportional to the cost of the service and also that said service is effectively provided. C) The quantification of the rate on 100% of the gross income of the province when there is a place enabled in a municipality of the province, therefore the ruling authorizes the municipalities to tax impongitable facts occurred outside their geographical limits.

In all aspects controversial by Esso Petrolera Argentina S.R.L. The ruling gave the reason to the claim of the municipality of Quilmes. The taxpayer’s right always remains to demonstrate that the service was not really provided. In such cases this ruling would not be relevant. However, it constitutes a discouraging precedent.

For taxpayers, the business community and legal operators their influence and projection is unquestionable because for analogous cases this interpretation cannot be ignored. It also projects a derivation on the category of really very complex and novel municipal rates.

I summarize the failure in the following reflections:

1) establishes an inexorable, worrying and metajurid criterion as is that- under the need to ensure the municipal regime- the municipalities must have guaranteed the “right to the media”. It is the right to subsistence of the municipality (no one could oppose it) but the effort to fulfill that right of the municipalities will fall entirely on taxpayers. Given this right of municipalities, what would now be the need to reduce public spending or make it more efficient?

2) The ruling uses an expression that has remained in the nineteenth -century tax law such as “the power of empire of the State.” The true legal nature of the tribute is a simple legal obligation to contribute. It is a tax obligation that does not derive from any empire power but from the law because we live in a constitutional state of law. Of course, the State exercises its imposition power to verify normal compliance, but the tribute is a legal obligation not the exercise of empire power. We still live in a republic.

3) The ruling shows a total absence of differentiation between tax and rate, which is why we believe that the CSJN requalifies the rate of rate. It indicates that the tax resources, in the case of municipal fees, constitute a central chapter to achieve compliance with the tasks of said state organization, whose primary purpose is to meet the most concrete, immediate and indispensable needs of the community. However, what should be emphasized is the concrete and particularized individualization of the service provided. In the case the ruling indicates that the service is inspection for safety and hygiene has been provided, therefore if the rate is not provided, it is inadmissible.

4) On the quantification of the tribute and specifically the tax base, the CSJN expresses in the ruling that is unspeakable that the fixation of its amount must weigh not only the cost of the services that are made available to each taxpayer but also its contributory capacity .

The CSJN would seem to have avoided the tax doctrine in the sense that the principle of contributory capacity is the realization of the principle of equality. Therefore the rate should not be set for the taxpayer’s contributory capacity but by the provision of the service. Then, when the rate is graduated, the contributory capacity must be weighted-but that principle is not the source of a rate.

However, the CSJN expressly considers this constitutional guarantee as a component of the municipal rate. Therefore, the Court does not find objections to admit that it can be graduated taking as a parameter the Gross Income Tax.

The ruling does not clarify what the linking would be- in point to the amount of the rate- between the Gross Revenue Tax and the provision of a municipal service. This relationship, the CSJN seems reasonable. Moreover, the ruling suggests that it ignores or minimizes the court’s doctrine about the need for a concrete, effective and individualized provision of a service for the origin of a rate. This would seem irrelevant because the court expressly interprets that “of statements that are not enough to disqualify the questioned rate and make it a constitutionally invalid tribute.” Then the doctrine coined by the CSJN in 1989 in the case “Chemical Cía c. Municipality of Tucumán ”.

5) Finally, the ruling does not lead to the unconstitutionality of article 35 Third paragraph of the multilateral agreement cannot be understood as the authorization for a municipality to “tax taxable events that occurred outside its geographical limits”. This standard authorizes graduating on 100% of the income produced in the province when the taxpayer has only local in a municipal jurisdiction. In short, the rate on an economic amount that does not inexorably corresponds to the municipality in question is quantified, therefore gravel activities that developed outside the municipal.

The CSJN found no objection to which it was serious about all provincial activity. For this reason this is another element that demonstrates that the ruling in question does not consider any way that the rate is the payment for the consideration of a divisible public service

ALTAMIRANO & ASOCIADOS.