Between Portugal and the ISV tax, it's a great love story. This tax (impostor sobre veiculos) concerns vehicles imported from abroad, and often represents an unpleasant surprise for expatriates who come to settle in Portugal. Being able to easily reach several thousand euros, this tax is disputed by taxpayers but also by Europe. For the first time, the Portuguese tax authorities were ordered to reimburse the full ISV tax collected for a used car imported from Germany. Lisbob, the expatriate assistant in Portugal, tells you all about this new defeat of the Portuguese tax authorities regarding the ISV tax.
Portuguese tax authorities ordered to reimburse full ISV tax for the first time
After several judgments in favor of the taxpayer in the arbitral tribunals, the Portuguese tax authorities now also lose before the administrative and fiscal court: the method of calculation in Portugal of the used ISV imported from the European Union is illegal. In this case today, the taxpayer will recover all of the ISV tax he has already paid.
The Almada Administrative and Tax Court ordered the cancellation of the vehicle tax (ISV) for a 2012 car imported from Germany in 2015 and for which the taxpayer had to pay around 4,000 euros. In addition to reimbursing the full amount paid, the Portuguese tax authorities will have to pay interest. This is the first decision of an administrative and tax court on the issue of the ISV for imported used cars. So far, the Portuguese tax authorities have lost all the cases in which there has been a decision.
This decision, now known, however, differs from the others, insofar as the taxpayer who brought forward the dispute will receive in full the tax he paid. In this case, a 2012 BMW acquired in Germany in 2015 was involved. At the time, the Portuguese tax authorities liquidated the ISV tax in the amount of 4,102.58 euros, but the owner of the vehicle, lawyer Filipa Brazão Melo, requested an assessment, for which she had paid 300 euros.
The ISV was finally set at 3,437 euros. Filipa Brazão Melo then launched a lawsuit, considering that the settlement was illegal and that the same was true for the costs of assessment that she had to bear. She asked for full reimbursement of the amounts paid and almost five years later, the decision was finally made.
The court agreed with him and ordered the tax authorities to return the total amount plus interest. Here is the big difference from the decisions that have been made so far: the vehicle owners had only claimed the excess ISV they paid because of the environmental factor and the court decided that 'they would be compensated for the difference only. Today, the Portuguese tax authorities have been ordered to reimburse the entire tax with interest. In addition, the Portuguese tax authorities will have to bear the costs and expenses of the complainant's lawyers.
Even though the procedure lasted 5 years, Filipa Brazão Melo says he is satisfied with the decision, which will surely give ideas to other taxpayers. As a reminder, Brussels considers the calculation of the ISV tax to be illegal and has already ordered Lisbon to modify it under penalty of conviction.
