An extra tax return is required for more than 35 million properties and land this year: the property tax must be recalculated. In practice, however, chaos prevails in many places. Criticism of the “bureaucracy monster” is loud, the IT of the tax authorities is overwhelmed. Politicians are tormenting many of those affected and are hesitant to extend the deadline urgently.
The countdown is on: by the end of October 2022, all property owners in Germany must declare themselves to the tax office. This requires the new property tax reform. German owners have a few weeks to prepare the new property tax return. Anyone who owned one of the almost 36 million properties in Germany on January 1, 2022 must submit the complex information electronically to the tax office by October 31.
But that is more difficult than expected. Tens of thousands of taxpayers struggled with error messages in the Elster tax office portal, looked for their standard land values in the Boris information system, and were put on hold at the tax office hotlines. In the meantime, Elster had even fallen completely because of the high rush.
Tax consultants across Germany report that the owners are groaning under the bureaucracy of the property tax reform, especially since there is unnecessary time pressure. With tax consultants, who have to deal with a lot of explanations, people are annoyed about the technical problems. “It is not surprising that IT cannot withstand this strain. This is annoying for all taxpayers,” complains Hartmut Schwab, President of the Federal Chamber of Tax Advisors. Elster turns the citizen into a service provider for the state and its officials. In fact, it should be the other way around.
Confusion arose among some apartment owners because they were promptly sent the request to submit the property tax assessment declaration and to participate in the census, for which the Federal Statistical Office also requested data on apartment sizes and rents. If you own objects in several federal states, you also have to fill out forms that are sometimes differently designed.
The property tax return must be submitted by October 31, 2022: With the “GrundsteuerErklärung” software from Steuertipps.de, you can master the task yourself in no time at all.
According to a federal state survey by the “Frankfurter Allgemeine Sonntagszeitung”, only relatively few owners of private property have submitted their property tax returns. Depending on the country, the submission rate is slightly above or even below ten percent of the expected declarations.
The fewest taxes have so far been in East Germany. In Mecklenburg-Western Pomerania, only 4.2 percent submitted the report. In Brandenburg, the rate is 5.2 percent. Berlin comes to 6.7, Thuringia to 7.4 and Saxony to 7.6 percent. According to the information, the tax rate is only over ten percent in six countries. Hessen is the best with 13.9 percent. Lower Saxony (12.7 percent), Schleswig-Holstein (11.9 percent) and Bavaria (11.6 percent) follow.
The low submission quotas are an indication that the entire re-registration process is in serious trouble. One hears from financial policy that it was expected that hardly any taxpayer would want to make the declaration in the summer and holiday season. Schleswig-Holstein’s Finance Minister Monika Heinold (Greens) says: “Experience shows that the momentum in the submission of tax returns always increases significantly as the deadlines come to an end.”
The tax consultants, however, sound the alarm. The Federal Chamber of Tax Advisors and the German Chambers of Industry and Commerce as well as some state politicians are urgently demanding an extension of the submission deadline, which normally ends on October 31st. After numerous complaints, Federal Finance Minister Christian Lindner is considering extending the submission deadline for the declaration of assessment for property tax. In response to criticism from a citizen at the federal government’s open day, the FDP leader said on Saturday in the Ministry of Finance: “I’m also worried about how things are currently going.” He is regularly informed about progress in data collection. Lindner added: “You may have to reserve the right to do something about the deadlines again.” The property tax reform was approved by the Bundestag in autumn 2019 under the coalition of Union and SPD. At that time, today’s Chancellor Olaf Scholz (SPD) was Minister of Finance.
“It turns out that the model of the new property tax implemented by the then Finance Minister Scholz and the SPD is too complicated and not citizen-friendly,” criticizes the deputy chairman of the Union faction Mathias Middelberg (CDU): “The taxpayers must above all receive quick and pragmatic assistance. “
The finance ministers of the federal and state governments want to decide at their conference at the end of September at the earliest whether the deadline for the submission of property tax returns will be extended.
The property tax had to be reformed because the Federal Constitutional Court had criticized outdated valuation bases in 2018. It is paid by all homeowners – and also by the tenants, because it can be passed on to the ancillary costs. Property tax is one of the most important sources of income for municipalities.
The large FOCUS Online guide answers all important questions about the subject of property tax reform on 19 pages.
The article “Tax consultants raise the alarm about property tax debacle” comes from WirtschaftsKurier.