SUPERIOR JUSTICE TRIBUNAL (“STJ – SUPERIOR TRIBUNAL DE JUSTIÇA”) – SPECIAL REMEDY Nº 1,221,170 – “PIS AND COFINS” – INPUT – CONCEPT

On February 22nd 2018 the 1st Section of the Superior Justice Tribunal – “STJ” – concluded the analysis of the said special remedy in which the concept of inputs generating credits in the calculation of non-cumulative “PIS and COFINS” were discussed.

The majority of the Ministers, excluding Og Fernandes, Benedito Gonçalves and Sérgio Kukina, understood that the Normative Instructions of “Receita Federal do Brasil” No. 247/02 and No. 404/04 contravene the concept of inputs established in Laws 10.637/02 and 10.833/03 when this should be assessed according to its essentiality or relevance for the development of the economic activity performed by each taxpayer.

This decision in spite of binding the entire judiciary and the Administrative Council Tax Appeals (“CARF – Conselho Administrativo Recursos Fiscais”) leaves the discretion as to the possibility of taking credit by the taxpayer in the hand of each judge of the other instances according to each case.