The German Federal Fiscal Court has submitted a question to the ECJ that is also of central importance for the deduction of input VAT, namely: What is the procedure in the case of leasing with simultaneous provision of operating equipment? Is this a single (VAT-exempt) rental service, or is there a general requirement to split the service up? The practice hopes for more legal certainty on this issue following clarification by the ECJ. To date, the correct assessment under tax law has been similar to playing the lottery. The German Federal Fiscal Court hopes that clear guidance from the ECJ will make it easier and faster to clarify many individual issues in practice.

In its decision published on 18.08.2021, the German Federal Constitutional Court declared the interest rate of 6% p.a., pursuant to sections 233a and 238 of the German Fiscal Code, to be unconstitutional. This applies to interest periods from 01.01.2014 onwards. However, at the same time, the Federal Constitutional Court ordered that the unconstitutional provision can, nevertheless, continue to be applied to interest periods until the end of 2018. Only for interest periods dating from 01.01.2019 is the legislator obliged to pass a new (retroactive) regulation. This new regulation must be put in place by 31.07.2022. The Federal Constitutional Court has now ruled on interest concerning a trade tax claim. In the case of interest on VAT liabilities, doubts remain as to whether the interest rate and the assessment of interest in general are in accordance with EU law. Taxpayers could take advantage of these doubts as regards the past.

In mid-July, severe storms hit large parts of Germany and caused enormous damage. The regions worst affected were in Rhineland-Palatinate and North Rhine-Westphalia, but also in Bavaria and Saxony. The tax authorities have reacted to this disaster by means of the introduction of a variety of equitable regulations. This should at least mitigate the financial damage caused to affected businesses. In addition, the enormous willingness of companies to help with the disaster relief is to be promoted by refraining from taxing supplies carried out free of charge and the adjustment, for a limited period of time, of input VAT in accordance with sec. 15a of the German VAT Act.