Still Talking about if the Costs of Transmission and Distribution Systems of Electrical Energy (TUST and TUSD, respectively) are Subject to Brazilian VAT (ICMS). A New Approach?

Abstract

Many discussions have been carried out between tax authorities and taxpayers on whether the costs of transmission and distribution systems of electrical energy (TUST and TUSD, respectively) are subject to Brazilian VAT (ICMS). Although much has already been debated, the issue remains especially due to the many inconsistencies between legal arguments and the nature of the transaction itself (“delivery” of electrical energy). Based upon scientific restlessness and curiosity, this article proposes a new approach on what has already been widely discussed about the subject, through a brief overview of the main arguments for and against, an analysis on how the electrical system operates, and, finally, by bringing awareness to some important questions, which are expected to lay down new basis for analyzing the issue.