In brief
On 30 April 2026, the Fourth Superior Tax Court of the Judicial District of the Caracas Metropolitan Area issued Judgment No. 004/2026 in Case No. AP41-U-2025-000005 (“STC4 Judgment”)1. Likewise, on 7 June 2026, the Superior Tax Court of the Guayana Region, with jurisdiction over the Judicial Districts of the states of Amazonas, Bolívar, and Delta Amacuro, issued Judgment No. PJ0662026000050 in Case No. FF01-U-2024-000028 (the “STCG Judgment”)2 (and collectively, the “Judgments”).
The Judgments establish relevant criteria regarding liability for the Special Contribution under Articles 6 and 7 of the Law on the Protection of Social Security Pensions against the Imperialist Blockade (“LPP”)3.
In more detail
Article 6 of the LPP establishes a special contribution applicable to legal entities, as well as to any other de facto partnerships, whether or not domiciled in the country, that carry out economic activities within Venezuelan territory (“Special Contribution”). Likewise, Article 7 determines that the tax base for the Special Contribution shall be the total of payments made by the taxpayer to employees as wages and non-wage bonuses.
In recent practice, the Tax Administration has fined numerous taxpayers for alleged failures to comply with formal duties related to the Special Contribution, regardless of whether they are currently conducting economic activities, have employees, or operate for profit.
Based on this criterion, the Judgments establish that liability for the Special Contribution under the LPP requires the cumulative fulfilment of three conditions: (i) the taxpayer must be a private legal entity or de facto partnership; (ii) it must carry out economic activities within Venezuelan territory; and (iii) it must make payments to employees in the form of wages and non-wage bonuses.
In this regard, the STC4 Judgment conducts an analogous analysis with respect to the Law on the National Institute for Training and Socialist Education (INCES, by its Spanish acronym), under which case law has established that certain taxpayers fall outside the scope of the parafiscal contribution provided therein. Specifically, when analysing the absence of a profit motive in the activities carried out by charitable and social welfare associations, the Court makes clear that the lack of profit or gain inherent to the exercise of an economic activity constitutes a non-taxable scenario for purposes of the Special Contribution, under the terms of Article 6 of the LPP.
Thus, the Court concludes that the appellant, by not carrying out economic activities or generating any profit — referring in turn to the findings of the accounting expert report commissioned — does not meet the cumulative conditions required for its liability to the Special Contribution provided for in the LPP.
Furthermore, the STCG Judgment held that, where neither labour-related expenses nor profits have been demonstrated, the circumstances set forth in Article 6 of the LPP — on which liability for the Special Contribution is based — are not present. Accordingly, the imposition of penalties for the alleged failure to comply with formal duties, based on the Venezuelan Tax Administration website’s criterion requiring taxpayers to report a number of employees greater than zero, constitutes a defect of false factual assumption and results in the absolute nullity of such penalties.
In this case, the Court recognized the practical impossibility of filing the return through the Tax Administration’s platform, given the system’s technical requirement to enter an existing payroll. This impossibility rendered the administrative act null and void and supported the conclusion that the alleged failure to comply with formal duties lacked legal basis, since having employees is one of the cumulative circumstances required to be liable for the Special Contribution. The Court further clarified that the automation of the Tax Administration’s system cannot, under any circumstances, override the principle of legality by penalizing a taxpayer for failing to comply with a duty that is impossible to fulfil and inapplicable to that taxpayer. On that basis, the Court annulled the administrative act contained in the resolution imposing the penalty for omission.
In summary, the Judgments coincide in holding that, in the absence of (i) economic activities carried out for profit and (ii) employees, a legal entity cannot be deemed liable for the Special Contribution. Consequently, any finding of an alleged failure to comply with formal duties under the LPP would lack legal basis. The Judgments also reaffirm that, in tax audit procedures concerning formal duties, the technical requirements of the Tax Administration’s system cannot justify the imposition of penalties for non-compliance where no such obligation exists.
Please do not hesitate to contact us should you require further information or clarification regarding the general aspects of the Judgments discussed in this alert, or in connection with any related matter.
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1 Judgment No. 004/2026 of 30 April 2026, Fourth Superior Tax Court of the Judicial District of the Caracas Metropolitan Area, Case: Instituto Universitario Jesús Obrero, A.C. v. SENIAT.
2 Judgment No. PJ0662026000050 of 7 June 2026, Superior Tax Court of the Guayana Region with jurisdiction over the Judicial Districts of the States of Amazonas, Bolívar, and Delta Amacuro, Case: DICASA, C.A. v. SENIAT.
3 Law on the Protection of Social Security Pensions against the Imperialist Blockade, published in the Official Gazette No. 6,806 (Extraordinary Edition) of 8 May 2024.