Supreme Court Jurisprudence
On May 29, 2025, the Supreme Court of Justice of Argentina (hereinafter, “the Court”), in the ruling “Kia Argentina S.A. v. Dirección General de Rentas de la Province of Misiones on administrative litigation” (the “Ruling”), overturned the judgment of the Superior Court of Misiones, which considered a contract with a tacit acceptance clause to be subject to stamp tax.
The Case
Kia Argentina S.A. (“Kia”) filed an administrative lawsuit against a resolution by the Tax Authority of the Province of Misiones, challenging the constitutionality of the final paragraph of Article 174 of the Province’s Tax Code (the “Code”). This provision subjects contracts between absent parties with fictitious acceptance clauses to stamp tax, which Kia argued violates the commitment to uphold the “principle of instrumentality” that the province assumed when adhering to Federal Revenue Sharing Law No. 23.548 (the “Law”).
The Superior Court of the Province of Misiones rejected the claim, stating that the application of the Code did not violate the Law, as it did not require contracts to be signed by both parties, only that there be a clear manifestation of intent, which could be achieved even fictitiously.
Furthermore, it held that the contractual provisions within the general regulations for dealers established that Kia’s tacit acceptance of the application constituted a “legal title,” allowing for the enforcement of obligations without requiring an additional document or further acts by the parties.
Kia then filed an extraordinary appeal, and upon its denial, lodged a complaint with the Supreme Court.
The Legal Conflict
The Federal Revenue Sharing Regime established under Law No. 23.548 holds superior authority over internal provincial laws, as it constitutes a multilateral agreement among provinces. One of its goals is to define certain types of taxes to avoid overlapping taxation on the same taxable event.
As a party to this regime, the Province of Misiones is required to comply with the legal text that defines the scope of the stamp tax under Article 9, subsection b, paragraph 2, which limits its application to acts, contracts, and operations of an onerous nature formalized through an instrument, defining “instrument” as: “any writing, paper, or document that evidences the execution of acts, contracts, and operations… in such a way that it has the external characteristics of a legal title by which obligations can be enforced without requiring any other document and regardless of the actions actually performed by the parties involved.” Thus the stamp tax is a tax on the instrumentation of legal acts.
However, Article 174 of the Misiones Tax Code allows for the taxation of “acts between absent parties” even if formalized fictitiously, thus potentially applying the stamp tax to legal situations not supported by a legal instrument.
The Court’s Decision
The Court first emphasized that the wording of Article 9, subsection b, paragraph 2 of the Federal Revenue Sharing Law was specifically intended to restrict the stamp tax to the instruments defined within that provision.
Secondly, the Court held that the purpose of the aforementioned article had been distorted by the interpretation of the provincial Superior Court, which treated the stamp tax as one imposed on “acts, contracts, and operations.” The Court further stated that the provincial court’s reasoning was contradictory, particularly its assertion that the Revenue Sharing Law did not require signatures from both parties. The Supreme Court noted that without mutual consent documented in a single legal instrument, it is not possible for the document to have the necessary external characteristics of a legal title or to meet the self-sufficiency required to be subject to stamp tax.
Thirdly, the Court noted that none of the three documents involved in the transaction (the general regulation, the application for dealership, and the vehicle order form), either individually or combined, could autonomously perfect a contract.
Based on these considerations, the Court overturned the judgment on the grounds that it was invalid under the doctrine of arbitrariness of rulings, having upheld the constitutionality of a local provision through reasoning marked by serious logical flaws and a complete lack of normative support.
