•  
• Tweet
•  
•        Print
•  
•         Track Keywords
•  
• 

By: WTS

The soft trade barrier of the peculiar German tax compliance is de facto lifted. For the first time, international funds will de facto be granted a comparable competitive playing field with their German counterparts as the tax compliance complexity and its inherent cost for UCITS and AIFs would be reduced to almost zero.

WTS would like to offer a brief executive summary and business evaluation of the interesting content of a recent draft bill on the future reform of German fund tax law.

The German legislator – after years of internal discussion – initiates the legislative process on a new Investment Tax Law providing for a fund taxation concept that implies a radical cultural change. The legislator now favors opaque over transparent taxation as the grand solution for the future.

The draft is dated 21 July 2015 and outlines the main ideas of the German Ministry of Finance for discussion purposes; it is not yet a formal legislative proposal. The Ministry has asked for industry comments by 1 September 2015.

A. Executive Summary

The concept paper differentiates between two substantially distinct tax systems:

• A traditional tax transparent concept for non-natural investors of so-called Spezialfonds
• A new opaque tax concept for the investors of all other funds such as UCITS, AIFs, single investor funds, except for partnerships.

For most retail, mutual and hedge funds (UCITS and AIFs), the draft bill proposes abolishi......................

To view our full article Click here