Judgment No. 8985 of 2024: Clarifications on the cadastral income for power plants

The recent judgment No. 8985 of April 4, 2024, issued by the Court of Cassation, has provided important clarifications regarding the determination of cadastral income for power plants, particularly in relation to plant components. This ruling fits into the regulatory framework established by Law No. 208 of 2015, which introduced significant changes in the assessment of properties with special purposes.

The regulatory context and the Court's ruling

According to Article 1, paragraph 21 of Law No. 208 of 2015, the inclined planes of power plants, being an integral part of the production process, should not be considered for the purpose of determining cadastral income. This principle is based on the fact that such components are inseparable from the production cycle and, therefore, their value should not be subject to taxation.

  • Law No. 208 of 2015 has excluded plant components from the calculation of cadastral income.
  • The judgment rejected the appeal from the Revenue Agency, which aimed to include the inclined planes in the assessment.
  • The distinguishing criterion applies regardless of the structural nature of the property.

Implications of the ruling for energy sector companies

This ruling has a significant impact on companies operating in the energy sector, as it allows for a reduction in the tax burden related to cadastral income. The Court's decision not to consider plant components enables companies to optimize their costs, facilitating investments and innovations in energy production. Power plants can therefore benefit from a more favorable tax regime, stimulating the competitiveness of the sector.

(CATASTRO) - IN GENERAL Special purpose properties - Power plants - Determination of cadastral income - Art. 1, paragraph 21, of Law No. 208 of 2015 - Plant component - Computability - Exclusion - Foundation - Case.

Conclusions

Judgment No. 8985 of 2024 represents a step forward in defining the tax rules for power plants and, more generally, for properties with special purposes. The Court has clarified that plant components, such as inclined planes, should not be included in the cadastral income, thereby emphasizing the importance of the productive functionality of properties. Companies in the energy sector can now plan their tax strategies with greater certainty, contributing to a more favorable economic environment for investments and development.

Bianucci Law Firm