Increase in inheritance tax: Bavaria particularly affected - Free State goes to court
Created: 01/02/2023 12:17 p.m
By: Thomas Eldersch
From this year, a higher inheritance tax will be due when inheriting real estate.
This applies above all to Bavaria.
The Free State reacted aggressively.
Munich – Anyone who inherits in Germany pays taxes for it.
Nothing will change in 2023 either.
What is changing, however, is the amount of inheritance tax, because real estate has been revalued since January 1st.
This change particularly affects Bavaria, since real estate prices here are the highest in Germany.
The Free State therefore wants to go before the Federal Constitutional Court.
Inheritance tax: Real estate prices are expected to continue to rise until 2035
Real estate owners are particularly affected by the changes brought about by the annual tax law.
So far, they have been able to benefit from the fact that the value of their property has not been counted as high as the actual market value would have been.
The law has now closed this loophole.
And a higher valuation automatically leads to a higher inheritance tax.
The University of Bonn has shown in a study why this change affects the Free State in particular.
40 percent of the nationwide wealth gains were achieved through rising real estate prices between 2011 and 2017 in Bavaria alone.
And according to the Postbank Housing Atlas 2022, nine of the ten most expensive districts in Germany are in Bavaria - or more precisely in Upper Bavaria.
Experts also assume that real estate prices will continue to rise until 2035.
This should primarily affect Munich, Landshut and Miesbach.
Bavaria wants to go to the Federal Constitutional Court because of inheritance tax
As a result, resentment arises not only among the citizens, who are often not responsible for the fact that their residential area is experiencing a real estate hype.
There is also resistance in politics.
For example, shortly before Christmas, Bavaria's finance minister Albert Füracker (CSU) announced in the
Bild
that "Bavaria would sue the Federal Constitutional Court".
However, the Free State will not go to court because of the changes to inheritance tax.
On the other hand, they want to force a “necessary increase in tax allowances and a regionalization of inheritance tax”.
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The fact is that the allowance for inheritance has not changed since 2009.
It is EUR 500,000 for spouses and EUR 400,000 per parent for children.
In addition, EUR 400,000 can be passed on to a child tax-free every ten years.
This can quickly add up to an amount in the millions over the years.
There is also a rule that if the heir lives in the property for at least ten years after the inheritance, up to 200 square meters of living space are tax-free.
It is also possible to defer inheritance tax without interest.
Bavaria wants to be able to determine the allowances and inheritance tax itself
Another point of criticism from the Bavarian state government is that the inheritance tax falls entirely to the state, while the federal government sets the rules.
Füracker: "The states are entitled to the full amount of inheritance tax - so the states should also be able to make decisive decisions about how it is structured." however, the allowances are not.
"This leads to a tax hike through the back door."
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Federal Finance Minister Christian Lindner (FDP) also got involved in the discussion.
He had spoken out in favor of increasing the allowances by 25 percent.
Opinion is divided in the other federal states.
When asked by BR, some stated that they wanted to wait for the decision of the Federal Minister of Finance.
Others, on the other hand, thought the allowances were appropriate.
Still others would increase the amounts, but do not want regional differences, as Bavaria would like.
Tax expert speaks out against Bavaria's plans for inheritance tax
And that's how the constitutional and tax lawyer Joachim Wieland from the University of Speyer sees it.
He told BR: Traditionally, inheritance tax has always been a tax regulated by the federal government.
And there are good reasons for that.
“Inheritance should not be taxed differently depending on the country in which it accrues.
Otherwise, that would possibly lead to a relocation movement.” In other words, that people would move from one federal state to another in order to save on inheritance tax.
Wieland goes on to say: "I don't think it's a question of equality or inequality." After all, no property is valued higher than it is worth anywhere.
The problem is rather that you can't see this value on the account, unlike when someone inherits shares or cash assets, for example: "And you can argue about it for a long time now: what is actually a fair solution in such a case. (
tel with dpa)
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