It is unreasonable to demand payment of Tax on Rural Territorial Property (ITR) in areas whose invasion by third parties prevents the holder from exercising full ownership of the rural property
The Tax on Rural Territorial Property (ITR) is the federal tax whose taxable event is the ownership, useful domain or possession of property located outside the urban area of the municipalities. In other words, it is the tax required from the rural owner, pursuant to article 1 of Law no. 9.393/1996[1].
The wording of the aforementioned provision, as elected by the legislator, encourages some discussions, especially because it brings property, useful domain OR possession as an event that gives rise to the tax obligation.
It is necessary here to bring the distinctions that are not always very clear between each of these terms. Ownership is understood as the formal ownership of a rural property, registered on the margins of the property’s registration; possession is understood as the factual ownership of the property; and domain, which is often understood as synonymous with property, would be the exercise of the powers to use, enjoy, dispose of and claim the thing, the internal relationship between the property and its owner.
Given this distinction, the question arises about the obligation to pay the Tax on Rural Territorial Property (ITR) in cases of occupied areas, whether by members of the Landless Rural Workers Movement (MST), by indigenous peoples or by another species of invader.
In these cases, despite the formal ownership being maintained, with the immovable property remaining under the property of the one in whose name it is registered, the owner ceases to have and exercise his rights of use and enjoyment over the property, since invasions withdraw the owner’s useful domain and ownership of his property.
Due to the delicacy of the matter, the Judiciary Branch has already been provoked to express its opinion on the subject and, although a peaceful understanding has not yet been reached, some groups of the Superior Court of Justice have understood that, with the invasions and the loss of the domain or possession of the property, the collection of Tax on Rural Territorial Property (ITR) must be waived.
The Attorney General’s Office of the National Treasury was also urged to manifest itself before the presentation of a consultation on the feasibility of including the unenforceability of ITR in invaded areas on the national list of exemption from contesting and appealing. Such considerations were included in Note PGFN/CRJ/No. 08/2018, which supports these considerations.
The point raised in the consultation before the Attorney General of the National Treasury was that “the invasion of rural property makes the collection of the Rural Land Tax – ITR unfeasible, during the period in which the situation of the possession embezzlement is verified, due to the mischaracterization of rights possession, use and enjoyment of the property.”
To answer the question, the PGFN analyzed the jurisprudence of the STJ, having collated some judgments and highlighted positions, in particular the one brought by Justice Herman Benjamin in the judgment of REsp 963.499/PR, in which he says that, with the invasion: “the right to property was deprived of practically all the elements inherent to it: there is no longer possession, nor the possibility of use or enjoyment of the property”.
Justice Herman Benjamin stated that, “Property rights without possession, use, enjoyment and incapable of generating any kind of income for its holder is no longer, in essence, property rights, as it is nothing more than an empty shell looking for its content and meaning, a legal formality denied by the reality of the facts”.
From the notes brought up, it appears that property, emptied of its elements of use and enjoyment and deprived of domain and possession, would not be sufficient to give rise to the mandatory payment of the ITR.
Another important point about the Tax on Rural Territorial Property is that the greater the degree of use of the property, the lower the applicable rate, as provided for in the table attached to Law n. 9.393/1996, translating the reality that the more the property is used, the less ITR will be paid.
From this specific point, it appears that the intention of the legislator was to stimulate rural productivity, ensuring compliance with the provisions of article 5, XXIII, of the Federal Constitution, so that the property fulfills its social function, demanding that rural owners their lands serve not only their own interests but also those of society as a whole.
This legal stimulus to increase rates in proportion to the reduction in the use of rural property is deeply linked to the effective exercise of ownership and ownership, taking us back to the discussion of the unenforceability of payment of the ITR in invaded areas.
This means that, in areas where the owner is restricted from the use and enjoyment of his property for reasons beyond his control, such as invasion by indigenous people or MST members, it is not reasonable to require him to fulfill the social function of the property, thus excluding the requirement to pay real taxes, inserting the ITR (REsp 1144982/PR) here.
In this sense, the PGFN correctly pointed out in its Note PGFN/CRJ/No. 08/2018: “if the owner does not have the right to use, enjoy and dispose of the property, as a result of its invasion, the property remains in a mere formality, not thus configuring the taxable event of the ITR”.
Finally, it is important to highlight that, since the right to property is constitutionally guaranteed under the terms of article 5, XXII of the Federal Constitution and security being a social right provided for in article 6 of the CF, it is not plausible that the owner of a property be required the payment of the Property Tax on this asset was invaded.
In the judgment of REsp 1144982/PR, Justice Mauro Campbell Marques highlighted that “It offends the basic principles of reasonableness and justice for the fact that the State violates the right to guarantee property and, at the same time, exercises its prerogative of constituting a tax lien on property expropriated by individuals (prohibition of venire contra factum proprium)”.
Therefore, in view of the above considerations, it is understood that, once the invasion of a rural property for reasons beyond the control of the owner, who remains the titleholder only formally, it is unreasonable to demand the payment of Tax on Rural Territorial Property (ITR), given the complete emptying of the other elements of the property.
[1] Art. 1 The Tax on Rural Territorial Property – ITR, which is calculated annually, has as its triggering event the ownership, useful domain or possession of property by nature, located outside the urban area of the municipality, on January 1st of each year.
Available at: https://www.jota.info/opiniao-e-analise/artigos/areas-invadidas-por-terceiros-e-a-exigencia-do-pagamento-do-itr-
Autor: Flávia Sant'Anna Benites • email: flavia@ernestoborges.com.br • Tel.: +55 67 99984 1406
