The compromise on the reform of the land tax, to which the Union and the SPD agreed on the weekend, obeys a brazen principle of grand coalition politics: they are moving, if only under pressure.
After months of hanging and sinking poll numbers, the government wanted and had to give a sign of action. In addition, threatened in the event of a lack of agreement tax losses of 14 billion euros in the municipalities, because the tax from the next year should no longer be collected. It was essential to avoid that.
The Bavarian state government is the winner of the months-long hustle and bustle, the loser is Federal Finance Minister Olaf Scholz (SPD). For a long time he fought for a nationwide regulation, in the end in vain.
The reform became necessary because last year the Federal Constitutional Court rejected the determination of the unit values for buildings and land on the basis of which the tax has so far been determined. In the West, approaches from the sixties, in the east even from the thirties. They had to be updated.
Scholz found himself in an unpleasant situation again. Although he is not entitled to anything from the advent of the tax, he is responsible as Federal Finance Minister for their reform. The result hits everyone, not just homeowners, because they pass these costs to the tenants sooner or later. So Scholz had to invest political capital, knowing that he would not profit from the result. It did not pay for him.
That was because Scholz wanted to use the opportunity to set an example of practiced social democratic tax justice. He presented a complex model, in which other components should also be included as calculation variables for the value of a property in addition to the area, for example the net cold rent. So he wanted to achieve that a 120-square-meter apartment in Munich is more heavily loaded than a similar size in Rumpel on the Knatter.
Above all the Bavarians resisted. Too complex was the model from Berlin, they were, and pleaded for the right of the countries to go it alone. The property tax should be based on their ideas only on the area of the property. That was socially unjust and led to a patchwork of different regulations, railed Scholz.
Nevertheless, he finally gave in: The result are opening clauses, they have made the agreement possible. This allows each federal state to specify its municipalities different tax determination parameters. This not least has an effect on the bureaucracy when the new tax rates are set – so far an important issue.
Is the regulation now found more unfair than the status quo? The answer is definitely no. The patchwork carpet described by Scholz as a vision of horror has been around for decades. Because each municipality can set the tax levy autonomously, comparable real estate is valued highly differently even today, and its owners are asked to pay the same amount. This will not change in the future.
It is also not true that in the future the resident of a Munich villa will only have to pay just as much land tax as the owner of an equally large peasant cate in Eitershofen. Decisive here, too, is the levy rate of the community, and this is likely to be a lot higher in the state capital than in the hamlet in Bavarian Swabia. The question of justice arises more within the communities, so if an apartment in the Munich trendy quarter Schwabing should be worth just as much as a comparable in the social hot spot Hasenbergl. But that's something the Bavarian politicians have to deal with.
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In general and nationwide, property tax will continue to apply in the future: sometimes the same is treated unequal and unequal, even the same – depending on where one lives. How much more expensive it will be for homeowners and tenants in the future, if at all, crucially depends on how the municipalities react to the new unit values.
The dispute over the property tax and the current compromise is not about questions of justice, but about the way in which they are levied. It is quite possible that after some time, other countries will take to the Bavarian path, because it turns out to be the less bureaucratic one.
A race for the cheapest taxation must not be feared chamberlain and state finance minister. The reason is trivial: a property, the name betrays, can not simply be relocated to a tax haven.