News on Tax Law
BFH doubts the constitutionality of additional payment interest
If the tax assessment leads to additional tax claims or tax refunds, the law requires interest of 6% p.a. after a certain period. Interest is paid regardless of whether the tax office or the taxpayer is to blame. In tax audits alone, the tax authorities have collected more than 2 billion euros in interest in recent years.
The Federal Fiscal Court (BFH) now has serious doubts as to the constitutionality of the interest rate for interest periods starting in 2015. The statutory interest rate significantly exceeds the appropriate framework of economic reality, as a low market interest rate level has now consolidated structurally and sustainably. There is no factual justification for the statutory interest rate in the required summary audit. In times of structural low interest rates, the unrealistic calculation of the interest rate acts as an unjustified surcharge on the tax assessment.
Read more about this in the tax info letter July 2017