There is a three-tier appeal system. The first appeal is to the tax office that
issued the assessment notice, essentially asking the inspectors to reconsider
their view on the point at issue. The next step is then to the competent regional
tax court, and from there to the one Supreme Tax Court which acts as the tax
court of appeal for the whole of Germany. Appeals to a regional tax court can be
on points of law or of fact, but appeals to the Supreme Tax Court can only be on
points of law.
If the Supreme Tax Court takes a different view of the law than
the regional court but cannot decide the case for lack of factual information, it
must refer the case back to the lower court rather than research the facts for
itself. With the agreement of the tax office, an appeal against an assessment can
be filed directly with the regional tax court, that is, one may “spring over” the
first step in the appeal process. This permission is often given where the
taxpayer is challenging the validity of some point in the official tax guidelines or
of a decree, but where the facts of the case are not in dispute.