GRUNDSTEUER SCHOCK! 17,000 euros!
In North Rhine-Westphalia, more precisely in Gladbeck, this is exactly what happened. A house that previously cost €122 in property tax now costs €17,000. The mayor of Gladbeck, Bettina Weist, confirmed in an interview with Spiegel Online that this is an exceptional case, but admitted that the new property tax for residential buildings will be significantly more expensive. At the same time, commercial properties are to become cheaper, which is leading to controversial discussions in North Rhine-Westphalia.
The opening option
A so-called opening clause is currently being discussed in North Rhine-Westphalia. This clause would allow cities and municipalities to levy a lower property tax for private residential buildings and apartments than for commercial buildings. A similar regulation already exists in Saxony, Berlin and Saarland. The State Ministry of Finance in North Rhine-Westphalia argues that companies should pay higher property taxes as they can deduct these costs from their taxes. However, this argument is flawed, as companies must first make a profit before they can pay taxes.
Higher property taxes for companies? The problem
The demand that companies should pay more property tax is economically and fiscally problematic. If companies are to pay higher property taxes, they must first earn the money to do so. Companies in Germany are already struggling with high taxes and many are moving abroad. An increase in property tax would only reinforce this trend and put jobs at risk.
The legal uncertainty of the new property tax
It is not yet clear whether the new property tax is even constitutional. There are doubts as to whether the property tax puts people with private houses and apartments on an equal footing, especially in comparison to companies. At the end of last year, there were two important court rulings from the tax court that cast doubt on the constitutionality of the new property tax. Now the Federal Fiscal Court, the highest German tax court, must decide whether the new property tax is constitutional. The decision is due to be made before the court recesses in July.
What can you do?
The new property tax is causing heated debate and considerable uncertainty. While some cities and municipalities are already implementing drastic increases, it remains to be seen whether the new regulation is constitutional.
If you have already received a property tax assessment notice, lodge an objection. This is easy to do with our 2024 property tax office sample objection.
You can use an objection to avoid paying the new property tax for the time being and wait for the final decision of the Federal Fiscal Court.
