“economic accumulation” of shares
From June 2013 onwards, a so-called “economic accumulation”
of shares in a corporation or a partnership (of at least 95%)
owning German real property is subject to German real estate
transfer tax as well. The economic participation equals the sum
of direct and indirect participations in the capital or assets of the
company.
Various transfers, such as acquisition by inheritance
or donation, as well as acquisitions by spouses or descendants,
are exempt from real estate transfer tax. In addition, specifc in-
tra-group business reorganizations are also exempt under certain
preconditions.
The tax is normally assessed on the basis of the consideration
given. Otherwise, the tax is based on the value of the real estate
as established under the German Valuation Law (Bewertungs-
gesetz).
The Federal Constitutional Court has declared the
substitute measurement basis under the German Valuation
Law to be unconstitutional. The legislator has been called upon
to implement a change in the law with retroactive effect from
January 1 2009. Since 2006, the states (Länder) have the right
to determine their own tax rates.
The current rate of tax is
3.5% in Bavaria and Saxony, 4.5% in Hamburg, 5% in Bremen,
Baden-Württemberg, Mecklenburg-Vorpommern, Lower Saxony,
Rhineland-Palatinate, Saxony-Anhalt, and Thuringia (in Thuringia
the tax rate will be 6,5% from 2017 onwards), 6% in Berlin and
Hesse, and 6.5% in Brandenburg, North Rhine-Westphalia,
Saarland, and Schleswig-Holstein.
EU Forecast
euf:ba.18g:113/nws-01