Solidarity surcharge not unconstitutional
Solidarity Surcharge
The so-called "second" solidarity surcharge has been levied since 1995. The legality of continuing to levy it is the subject of heated debate. Among other things, the President of the Federal Court of Audit concluded in his expert opinion on the dismantling of the solidarity surcharge (Gz I 2-90 08 04 dated June 4, 2019) that "the reason for the introduction of the solidarity surcharge as a supplementary levy ceased to exist when the Solidarity Pact II expired at the end of 2019."
BFH ruling
A married couple brought an action before the Federal Fiscal Court/BFH against advance payments on the solidarity surcharge from 2020, and the BFH dismissed the action (ruling of 17 January 2023, IX R 15/20). According to the BFH ruling, the solidarity surcharge was "not yet unconstitutional in 2020 and 2021." This means that the federal government can continue to expect €11 billion in additional revenue per year. The BFH did not have to rule on 2022 and subsequent years.
Justification
The BFH justifies its opinion, among other things, that the levying of the solidarity surcharge at a surcharge rate of 5.5% does not unconstitutionally impair the financial order. On the one hand, the reunification-related financial needs of the federal government would continue to exist in 2020 and 2021. For another, "a possible "rededication" of the solidarity surcharge for other purposes is irrelevant," according to the BFH. In other words, the legislature can do whatever it wants with the revenue from the solidarity surcharge.
Capital investors, principle of equality
Capital investors generally pay a solidarity surcharge on all capital income, with no exemption limit and regardless of the amount of the capital income. The BFH does not see this as unequal treatment. The BFH also considers the fact that around 90% of taxpayers will no longer pay solidarity surcharge since 2021, but only high earners, to be lawful. The BFH does not see this as a violation of the general principle of equality under Article 3 of the German Basic Law.
Status: February 23, 2023
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