Legitimate Expectations and VAT: A Portuguese Case Study

Portugal’s reduced VAT rate for urban redevelopment became a decade-long source of uncertainty and controversy due to fragmented municipal interpretations, shifting tax authority practices, and a recent unifying judgment of the Supreme Administrative Court triggering retroactive standard VAT rate assessments. In this article, the authors analyse this conflict through the lens of legitimate expectations, contrasting standards of the Court of Justice of European Union with Portuguese constitutional protections. The article highlights how transitional rules put in place by the national legislature were jeopardized by administrative and judicial practices and concludes with a broader inquiry concerning constitutional pluralism in VAT adjudication.