STF Decision on the unconstitutionality of the registration requirement for service providers from other municipalities – Practical effects

Practical effects of the STF Decision on the unconstitutionality of the registration requirement for service providers from other municipalities.

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STF Decision on the unconstitutionality of the registration requirement for service providers from other municipalities - Practical effects


In the recent judgment of Special Appeal - RE 1167509 - presented by the Union of Data Processing and Computer Services Companies of the State of São Paulo - SEPROESP, the STF established the thesis that “It is incompatible with the Federal Constitution the normative proposal providing for the mandatory nature of registration, in a municipal administration agency, of a service provider not established in the municipality and imposition of the Withholding Tax on Services - ISS on the borrower when the accessory obligation is not complied".

Clarifying in detail, this is the situation where the service provider located in a different municipality from its client must register with the municipality where its client is established. In the case of not registering, which many municipalities call CEPOM, your client is required to withhold the ISS. Effectively, the service provider pays to the client's municipality and pays to the municipality where it is established.

Although the thesis of the STF is of General Repercussion, the effect is only valid between the parties in the process.

Therefore, those service providers interested in the same treatment of not being required to obtain registration in the municipality where its client is established should go to court to no longer be imposed to such registration, with a good chance of achieving the same result that SEPOESP obtained.

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