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ARTICLE · 12 DECEMBER 2014

Judgment Federal Constitutional Court On Inheritance And Gift Tax Act

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The Federal Constitutional Court announced that its long-awaited judgment on the Inheritance and Gift Tax Act will be delivered on 17 December 2014

GermanyTax
Andreas Richter
Andreas Richter
Maximilian Haag
Maximilian Haag
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The Federal Constitutional Court announced that its long-awaited judgment on the Inheritance and Gift Tax Act will be delivered on 17 December 2014. The decision will focus on the question whether the currently applicable beneficial rules regarding the gratuitous transfer of business assets are consistent with the principle of equality in taxation (Art. 3 para. 1 German Federal Constitution). It is expected that the court will disapprove the currently still existing generous possibilities of a tax exemption of 85% or even 100% of the company or share value and will demand new rules from the legislator.

However, it is not clear what legal consequences will result from the expected judgment of the Federal Constitutional Court for the period until new rules enter into force. Basically, the following scenarios are possible:

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