Assessment – tax interest – unconstitutional
Refunds or subsequent payments in connection with the assessment of income, corporation, trade and sales taxes are regularly subject to interest of 0.5% for each full month (= 6% per annum) after a 15-month grace period (cf. Section 233a in conjunction with Section 238 AO). In the opinion of the Federal Fiscal Court, this regulation is unconstitutional, at least from 2015 onwards, due to the interest rate no longer being in line with the market.
Now, the Münster Fiscal Court has ruled in the case of suspension interest – which is also subject to the interest regulation – that the interest rate is already too high from 2014.
However, the court also commented on the question of the appropriateness of the interest: according to this, an interest rate of 3% per annum for the year 2014 was not objectionable. However, even in a low-interest phase, a complete waiver of the imposition of suspension interest was not warranted.
An appeal against this ruling has been lodged with the Federal Fiscal Court.
(For further comments and information, please see our Information Letter 12/2018).
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