2023-07-21 12:33:54
The Supreme Court has turned its back on those who could not claim the municipal capital gains before the declaration of unconstitutionality of the Constitutional Court on October 26, 2021. The high court considers that a tax assessment not appealed before October 26 is already a consolidated situation and that, as such, it is not affected by the declaration of unconstitutionality of the tax nor can it be annulled based on it.
The Supreme Court, in its judgment 949/2023, of July 10has set criteria on the application by judges and courts of the declaration of absolute unconstitutionality of the tax on the increase in the value of land, and the limitation of temporary effects that the Constitutional Court decreed in judgment 182/2021, of October 26.
In the case resolved, the Provincial Council of Pontevedra appealed to the Supreme Court the ruling of a contentious-administrative court that annulled a tax assessment for capital gains, in contradiction with the decision of the Constitutional Court to limit the temporary effects of the declaration of unconstitutionality of the rules of that tax.
The Supreme Court upholds the appeal and declares that a tax settlement not appealed before the declaration of unconstitutionality is known, is a consolidated situation because the Constitutional Court declared it so in its judgment of October 26, 2021, and that, as such a consolidated situation, it is not affected by the declaration of unconstitutionality of the tax, nor can it be annulled based on it.
The judicial resolution, issued by the Second Section of the Third Chamber of the Supreme Court, with a presentation by Judge Rafael Toledano, analyzes the scope and foundation of the Constitutional Court’s power to determine the temporary effects of sentences that declare the unconstitutionality of norms. It points out that the Organic Law of the Constitutional Court expressly provides for the possibility of publication of the ruling before the mandatory publication by the BOE and concludes that «[…] the delimitation of the consolidated situations as of this date of the sentencing is a decision of the Constitutional Court that only corresponds to it, within the exercise of its powers and responsibilities […]», for which the Judges and Courts, as well as the public powers in general, remain bound and must respect and apply said limitation of effects in their own terms.
The judges of the Supreme Court clarify that, in these cases, however, it is possible to annul the tax assessments by applying other unconstitutionality rulings in which the Constitutional Court did not limit the temporal effects of its decision, such as the cases of real estate transfer settlements in which there was no profit, or when the tax is confiscatory because it absorbs all the profit, in addition to any other reason other than the declaration of unconstitutionality declared by STC 182/20 21.
With this judicial resolution, criteria are set in a matter that has been resolved in a different way in the different Contentious-Administrative Courts and Tribunals, in the cases of those taxpayers who were within the term to appeal liquidations for capital gains on the date that the unconstitutionality was declared, but had not yet formalized their appeal.
In the opinion of Jose Maria SalcedoManaging Partner of Salcedo Tax Litigation and lawyer specialized in filing appeals and claims against the Treasury, we are before a devastating sentence, which shows how the Supreme Court gives carte blanche to the Constitutional Court to limit the effects of its sentenceseven if this means violating the law, and reducing the procedural rights of taxpayers.
In particular, Salcedo considers that “the mention in the judgment of the Supreme Court that “the liquidation that is not yet final cannot be challenged, despite the fact that the legal terms for that purpose have not elapsed” is especially worrying, since it is openly recognized that the possibility of alleging unconstitutionality is denied to taxpayers who are in the appeal period.”
Finally, José María Salcedo draws attention to the different treatment that the Supreme Court gives to infringements of Community Law, compared to violations of the Constitution. And it highlights that while everything possible is already being done to return the unduly paid to those affected by the 720 model (after having declared that its sanctioning regime violated the freedoms of the European Union), the Supreme Court has turned its back on those who request the return of the unconstitutional municipal capital gains.
For this reason, it is evident that violating the Constitution is much cheaper for the Treasury than violating Community Law, Salcedo ditch.
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