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The Minister of Finance of Bavaria is locked in Reform of the estate tax

The Reform of the basic moves expensive closer. Federal Finance Minister Olaf Scholz (SPD) agreed on Thursday with his country colleagues, to prepare, on the Basis of the compromise a draft law. Scholz said it was a "reasonable result".

However, had the Vice-Chancellor to move away again from his original plans. In the beginning of February, he came to meet the countries (and, indirectly, of the Union group in the Bundestag), because too much criticism of his in the November proposal had accumulated. Scholz had sought a value-based property tax, and on three value components in addition to the soil and building surface area: land values, building ages, and net rent. The Scholz model was based on individual ratings for each plot. The appeared but the countries are too time-consuming and bureaucratic. Bavaria and the Union faction in the Bundestag, urged to collect instead of a value model is a pure land tax. But there are in the Federal Council, not a majority, even Union countries are aiming to achieve a value-based property tax.

at the beginning of February, the Finance Ministers agreed, therefore, a key issues paper based instead of case-by-case evaluation of over-generalisation. Although it remained in land values, building ages, and net indicative rent. But was the Rent agreed on, instead of actual Rent only the regional average rent, according to the microcensus. This had been used by Scholz, first only for private property used, now, this should be a lump sum of values for all property tax assessment notices. The key issues paper from the 1. February rent provided for setting the actual net in cases where the Rent is below the average, ran for rent, was removed on Thursday.

relief for affordable Housing

There is, however, unfavorable for the promotion of affordable housing, a goal of the great coalition in the Federal government, the Finance Ministers agreed on a kind of social clause. Accordingly, it is intended to give a basic tax credit in the Social housing, housing associations in the public sector, co-operatives and housing associations and charitable housing associations. Also, this should be done as a lump sum – a reduced tax measure. In such apartments the Rents are often below the local market average. From the SPD group in the Bundestag, it was, you welcome "this is a clear social-democratic handwriting of the reform compromise".

is Remained to consider the age of Buildings in the assessment, where in February all the real estate that were built before 1948, a lump sum should be treated. In the case of the standard land values, it also remains that it is not the individual plots of land can be used, but the basic tax is calculated in the future according to the standard land value zones.

Söder wants a "fresh start" of the negotiations

While Scholz as a "major milestone," announced the Bavarian Minister of Finance Albert Füracker (CSU), his country will not agree to the proposal, as he was now on the table. Prime Minister Markus Söder (CSU) called for a fundamental new beginning in the negotiations. He told the German press Agency: "At the country level, the Problem seems not solvable. Therefore, we will drag the coalition map on the Federal level. There is a working group of the coalition need to find a solution.“ It could be a possibility of country-specific regulations.

Hesse's Finance Minister Thomas Schäfer (CDU) were, however, far more open and welcomed the compromise. The original Scholz-model of a value-based tax would clearly have been freed of red tape. "I'm glad we managed to purge the original bureaucratic proposal of the Federal government. He is still more complex than a pure surface model, but approaches this in terms of the burden both for citizens and the administration.“

The question now is whether the CSU will continue your resistance to the Union group in the Bundestag, also leading CDU members as the group's Vice Andreas Jung had registered strong reservations against a value-based tax. Thus, the Reform could also become an issue for the coalition at the tips. In the Union there are concerns, because some people see in a value-based tax, a precursor to the re-introduction of a wealth tax. In addition, a pure land is considered to be expensive as a much easier and less bureaucratic, even if the land would then be taxed just regardless of the actual value belongs to the building. However, it is unclear whether the Federal government is the competent legislature for a land tax - and that would not be the responsibility of the States.

Green: CSU must now

The Green parliamentary deputies and local expert Stefan Schmidt called on the CSU to end their resistance. He was glad that a decisive step had been made to a good compromise. "The CSU needs to jump now and not boycott more agreement on this for the communities that are so crucial revenue source," he said to the daily mirror. The property tax flows alone to the local authorities and brings to you currently about 14 billion euros in the year. "Time is of the essence. It may now be no more blockades.“

The Federal constitutional court had classified the existing land tax a year ago as unconstitutional because it was based on completely outdated values, and a new regulation by the end of 2019 required. The basis for the taxation of so-called unit values from the years 1954 to the West, and in 1935 in the East. This value is based on the basis of obsolete data, which are, of course, in the meantime, far away from the actual traffic values, and also the different treatment to the West and the East, contrary to the view of the Karlsruhe court against the equality and principle of equal treatment in the Constitution.

The state of schleswig-Holstein Finance Minister Monika Heinold (Green) that said, contributed to a flat rate model the solution, to the daily mirror: "today's milestone that has been reached can only lead to the finish, if the Grand coalition will manage to get CSU on the Board." She pointed out that the basic structure of the fundamental tax reform "simplified". In the Union the area is covered model like the term "simple model".

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Also, according to Baden-württemberg's Minister of Finance, Edith Sitzmann (Green) was achieved simplification, "which improves the viability of a compromise." She stressed, however, that in other legislation, many of the more detailed procedures still have to ask to be clarified. In the view of the Brandenburg Minister of Finance Christian Görke (Left) comes through the property tax-favoured-nation treatment in the Social housing and cooperatives, the fear from the table, "that it is a result of the Reform, substantial rent increases".

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