Garrigues achieves first tax judgment with hearing at Supreme Court
The reform of the Judicial Review Jurisdiction Law, which entered into force on July 22, 2016, brought about a notable change in the cassation appeal in the judicial review jurisdiction. In particular, it introduced two major changes: the first one being the requirement that there be an objective cassation interest for the establishment of case law, such that the matter requires the Supreme Court to rule on it. Consequently, the reform significantly stiffens the requirements for these kinds of appeals to be granted leave by the Court.
The second one relates to the possibility that the Supreme Court may order the holding of hearings that enable it to hear the parties’ arguments before handing down its judgment.
To understand the relevance of the process carried out by Garrigues, we need to go back to September 16, 2016, when the client received notification of the first negative judgment in the proceedings. To contest the judgment, Garrigues had to file a cassation appeal in the judicial review jurisdiction, only a few days after the recently enacted reform had entered into force.
The appeal was successfully filed and granted leave to proceed by the Judicial Review Chamber of the Supreme Court. Since an objective cassation interest was present, the Chamber considered that it was necessary to obtain the Supreme Court’s interpretation on matters relating to the tax on economic activities (particularly to heading 661.2 of the classifications of the tax and other connected provisions).
Then, and for the first time in the history of the Supreme Court, the Court decided to order that a cassation hearing be held so that both parties could present their legal arguments orally. The hearing, which was the first of its kind in Spain on a tax matter, took place on July 4, 2017 and, as a result, at the end of December, Garrigues’ client received notification of the Supreme Court’s decision: a fully favorable judgment.
Garrigues Tax Department