Great uncertainty surrounds the determination that there is need for amendment: Is one required to submit an effective self-disclosure in accordance with sec. 371 General Fiscal Code or is a simple amendment in accordance with sec. 153 General Fiscal Code sufficient? Many questions remain unanswered which has resulted in significant irritation for practitioners and their clients alike. The Ministry of Finance has now gone some way in clarifying the Fiscal Code Application Decree. The Ministry’s message: Companies which have implemented an internal control system will be in a better position in the future. This is because such a system will be seen as an indication of an absence of malice. Amendments may then be made in accordance with sec. 153 German General Fiscal Code.

The settlement of past property developer cases has stagnated due to the Federal Fiscal Court decision of 27.01.2016. According to this decision, the point in time the property developer pays the VAT amount to the supplier is decisive as regards the tax assessment for the supplier and the property developer’s refund claim. The result is property developers losing their interest return. The fiscal authorities have now discontinued payments to property developers until further clarification. In its current judgment, the tax court in Münster opposes the Federal Fiscal Court’s opinion. An appeal is now pending.

The Arab Gulf states are intending to implement a VAT system, however the process is currently only in its infancy. Numerous other countries are now focusing on increasing their revenues from e-commerce and distance sales. The EU member states currently have other problems to cope with. This time it is Estonia, Italy, Romania and the Czech Republic, who are all trying to tackle VAT fraud by extending the reverse charge scheme. Switzerland is going to amend its regulations in order to make more foreign entrepreneurs liable for VAT. In addition, Poland is now requesting more information from taxpayers.