The generation of losses may result in the nullity of the IAE receipt
In recent months, various pronouncements have been published in which our courts have questioned the liquidations of the Tax on Economic Activities (IAE) of 2020 on the basis of the necessary respect for the constitutional principles of economic capacity and non-confiscation, due to the exceptional circumstances that participated in that exercise as a result of the health crisis.
Among others, the following sentences are worth noting:
- The Superior Court of Justice of Extremadura, in its judgment of December 2, 2021 , recognizes the taxpayer’s right to obtain a proportional reduction in the IAE fee for the period of mandatory closure of the activity during 2020, thus confirming the conclusion of the Contentious-Administrative Court No. 3 of Alicante. In this ruling, moreover, the court expressly rejects the reasoning (against this conclusion) defended by the Regional Economic-Administrative Court of Aragon in its resolution of July 22, 2021.
- On the other hand, the Contentious-Administrative Court No. 2 of Santander has issued a judgment of December 16, 2021, in which it has annulled the receipt of the 2020 IAE of an entity, for having been issued without taking into account the special concurrent circumstances in said exercise.
The court understands that the appellant has proven that the economic sector to which it belongs had had generalized losses during the year 2020, which means that one of the premises established in the IAE regulatory regulations is breached so that this tax can be demanded.
This pronouncement represents a further step with respect to the judgment of the Superior Court of Justice of Extremadura, because it annuls the entire IAE fee instead of reducing it proportionally for the period of mandatory closure of economic activity.
In short, although not yet in a general way, it seems that the courts are welcoming the need to (i) take into account the exceptional circumstances that affected the 2020 financial year as a result of the pandemic; and (ii) guarantee respect for the principles of economic capacity and non-confiscation, which govern our tax system.