With the recent sentence no. 3 of last 8 March 2024L'Plenary meeting of the Council of State took care of providing indications for determining the production cost in the case of taxation of building abuse in cases of interventions building renovation in the absence of a building permit or in total discrepancy.
As is known, in fact, art. 33, paragraph 2, of Consolidated Construction Law (Presidential Decree 380/2001) provides that “If, based on a reasoned assessment by the municipal technical office, restoring the state of the premises is not possible, the manager or person in charge of the office imposes a financial penalty equal to double the increase in value of the property, consequent to the realization of the works, determined, with reference to the date of completion of the works, based on the criteria established by law 27 July 1978, n. 392 and with reference to the last production cost determined by ministerial decree, updated to the date of execution of the abuse, based on the ISTAT construction cost index, with the exclusion of municipalities not required to apply the same law , of the parameter relating to the location and with the equivalence to category A/1 of the categories not included in article 16 of the same law. For buildings used for purposes other than residential use, the fine is equal to double the increase market value of the propertydetermined by the local agency.”.
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In particular, the Meeting clarified how this production cost should be determined.
Production cost: two possible interpretations
This cost could be interpreted in two ways:
- as established by the ministerial decree, with consequent update of the amount on the date of execution of the abusebased on the ISTAT construction cost index;
- with reference to the last production cost determined by ministerial decree, updated on the date of execution of the abuse, and the amount thus obtained goes increased on the basis of the ISTAT construction cost index.
This second reading – which enhances the comma following the word “abuse” – notes that the term “updated” refers to the last production cost determined by the ministerial decree, updated to the date of execution of the abuse, i.e. to the ministerial decree issued close to the execution of the abuse.
The date of execution of the abuse
The choice between the two literal interpretations illustrated above leaves an open question further questionor what is meant by “date of execution of the abuse“. In this regard, they are possible four different interpretationsof which only the first is more in line with its textual data:
- the moment in which the illegal building works are completed;
- the moment in which the abuse is ascertained by the administration;
- the moment in which the abuse is self-declared by the interested party;
- the moment in which the pecuniary sanction is imposed.
The solution
L'art. 33, paragraph 2, of the Consolidated Building Act provides that two distinct operations must be carried out:
- identify the production costdetermined with the ministerial decree updated to the date of execution of the abuse;
- update the amount of the fineidentified on the basis of the construction cost, applying the ISTAT index.
It follows that it is not the amount indicated in the ministerial decree that should be indexed, but that updated to the date of execution of the abuse: this solution, on the one hand, allows you to specify which ministerial decree should be used and on the other hand, it explains why there is a comma after the term “abuse” in the sentence.
As regards, then, the phrase “date of execution of the abuse”, its textual data is relevant. The increase in value of the property must be identified on the basis of the criteria contained in law no. 392/1978, calculating the conventional surface area and considering the unit production cost according to the ministerial decree updated on the date of execution of the abuse: the multiplication between the two terms indicates the overall production cost, i.e. theaestimatiowhich needs to be updated (taxatio) based on the ISTAT construction cost index.
The legislator reiterated that the sanctioning power must be exercised even when there are objective technical difficulties in carrying out the demolition, derogating from the general rule according to which building violations must be physically removed. The relevant power can be exercised at the request of the person responsible for the abuse, if it is objectively impossible to proceed with the reduction of the non-compliant parts to pristine condition without affecting the stability of the entire building.
In balancing conflicting interests, the legislator has provided that the financial penalty actually paid takes into account the actual value of the illegal worksthe only one significant for the definition of the concrete case, e not the inferior one dating back to the pastno longer anchored to the actual value of the asset.
It is significant that the art. 33, paragraph 2, follows the repealed paragraph 2 of the art. 9 of Law no. 47/1985, according to which: “If, on the basis of a reasoned assessment by the municipal technical office, the restoration of the state of the places is not possible, the mayor imposes a pecuniary sanction equal to double the increase in value of the property, resulting from the implementation of the works, determined, with reference to the date of completion of the works, based on the criteria established by law 27 July 1978, n. 392”.
This last provision it contained no adjustment mechanism, but the mere reference to law no. 392/1978, whose art. 22, paragraph 1, now repealed pursuant to art. 14, of law no. 431/1998, i.e. limited to residential rentals, established that: “For properties used for residential purposes which were completed after 31 December 1975, the basic production cost per square meter is set by decree of the President of the Republic, upon proposal of the Minister of Public Works, in concert with that of grace and justice, having heard the Council of Ministers, to be issued by 31 March of each year and to be published in the Official Journal of the Republic”. The annual issuing of ministerial decrees, therefore, already entailed a periodic adjustment with automatic effects for the commensuration of the sanction.
Furthermore, a adjustment mechanism, similar to that provided for by art. 33, paragraph 2, is contained in theart. 34paragraph, according to which: “When the demolition cannot take place without prejudice to the part carried out in compliance, the manager or office manager applies a sanction equal to double the production cost, established on the basis of law 27 July 1978, n. 392, of the part of the work carried out in breach of the building permit, if for residential use, and equal to double the market value, determined by the local agency, for works used for uses other than residential”.
This last provision concerns less serious conduct of those regulated by the art. 33, paragraph 2, and must be understood – with reference to cases in which the property is both for residential use and for use other than residential – in the sense that taxation must take into account the value of the asset at the time of its determination.
However, the interpretation of the art. would be unreasonable. 33, paragraph 2, according to which it would detect the value of the asset at the time of realization of the works. The pecuniary sanction constitutes, in the mandatory cases permitted, an alternative measure to the physical demolition of the building and must constitute a homogeneous and effective “sanctioning response”.which would not exist if one had to take into account its lower value, commensurate with the time of the abuse.
The two principles of law
Therefore, according to the Plenary Assembly:
- the expression “date of execution of the abuse” must be understood as the moment of realization of the illegal works;
- for the purposes of determining the pecuniary sanction to be determined pursuant to art. 33, paragraph 2, of Presidential Decree 380 of 2001, the conventional surface area must be determined pursuant to art. 13 of law no. 392/1978 and the determination of the unit production cost, on the basis of the decree updated on the date of execution of the abuse. The overall production costgiven by multiplication of the conventional surface area with the unit production costit goes updated according to the ISTAT construction cost index.
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