The Government of the State of Rio de Janeiro has enacted a new special program for the payment of tax debts and fines from the State Accounting Court, through Complementary Law 182/2018 (LC 182/2018), published last Friday (September 21). Justified by the need to pay the 13th salaries of the Executive's officers, the measure came as an exception to Complementary Law 175/2016, which prohibited the grant of amnesty or remission of tax debts by the State of Rio de Janeiro for 10 years.

According to the new complementary law, the taxpayer can settle tax debts related to ICMS, IPVA (in the case of natural persons) and fines imposed by the State Accounting Court, with an amount higher than 450 UFIR-RJ (currently BRL 1,482.25), with due dates before June 30, 2018,  whether assessed or not, enrolled into the State outstanding debtors list or not and include those already being collected in court.

LC 182/2018 allows the payment of the consolidated tax debt (updated amount plus fines and interest) according to the following alternatives:

(i) a lump sum payment, paid up until the last working day of the issuance month of the payment form (DARJ), with a reduction of 85% of fines and 50% of default interests;

(ii) in 15 installments, with a reduction of 65% in fines and 35% of default interest;

(iii) in 30 installments, with a reduction of 50% in fines and 20% of default interest; or

(iii) in 60 installments, with a reduction of 40% in fines and 15% of default interest.

Debts related exclusively to fines resulting from non-compliance with ICMS’ obligations, whether or not enrolled into the State outstanding debtors list, can be included in the program if the fault occurred until March 31, 2018, according to the following payment alternatives:

(i) in a lump sum payment, paid up until the last working day of the issuance month of the payment form (DARJ), with a reduction of 70% of fines and 50% of default interest;

(ii) in 15 installments, with a reduction of 55% in fines and 35% of default interest;

(iii) in 30 installments, with a reduction of 40% in fines and 20% of default interest; or

(iii) in 60 installments, with a reduction of 20% in fines and 15% of default interest.

The law also allows taxpayers to cumulate these discounts with the fines reduction provided by the articles 70, 70-A, 70-B and 70-C of Law 2.657/96, which are:

(i) 50% in the case of payment within 30 days counted from the date of the knowledge of the Tax Assessment;

(ii) 20% in the case of payment within 30 days counted from the knowledge of the 1st administrative instance’s decision;

(iii) 10% in the case of payment within 30 days counted from the knowledge of the 2nd administrative instance’s decision;

(iv) 90% and 70% for fines for not complying with ancillary obligations, if these have been settled within 30 days or before the tax inspection, respectively; and

(v) 50% in penalties for infractions committed by micro and small enterprises, defined by Federal Complementary Law 123/2006.

In addition, taxpayers can use LC 182/2018 to pay (i) the remaining amounts of the consolidated tax debts of previous payment in installments programs, except for those related to other amnesty or remission programs; (ii) the ICMS related to tax substitution; and (iii) fines resulting from non-compliance with ancillary obligations.

The Complementary Law expressly prohibits the payment of tax debts enrolled into the program with the conversion of judicial deposits into State’s revenue. Therefore, taxpayers must have to pay the amount due with the relevant reduction stated in the amnesty program and then request the withdrawal of the judicial deposit.

The enrollment into the amnesty program implies in the irrevocable and irreversible confession of the tax debt, expressly renounces of any defense or administrative or judicial appeal as well as the withdrawal of those already filed. If there is an administrative proceeding in progress regarding the debt, the taxpayer must have to inform the waiver of defenses and appeals within 30 days counting from the enrollment into the amnesty program.

Finally, the enrollment into the amnesty program requires the regularity of the taxpayer over the entire installment period. Taxpayers can be excluded in case of (i) non-payment of three consecutive installments; (ii) existence of unpaid installment for more than 90 days; and (iii) default or irregularity of any other principal or ancillary obligations due for more than 60 days.

The deadline established for the enrollment into the amnesty program was set at 30 days from the regulation by the Executive Power, which has not occurred yet.