Federal Supreme Court Confirms Subsidy Classification in Cultural Sector Funding Case

• The blog post analyzes a Federal Administrative Court ruling on classifying forwarded subsidies in the cultural sector.
• The Federal Supreme Court confirmed the lower court’s assessment but with different reasoning.
• A-GmbH, involved in film production, receives funding from a private-law foundation funded by Zurich’s city and canton.
• The FTA classified the funding as subsidies, demanding additional tax payments, which the foundation contested.
• The Federal Administrative Court ruled that the foundation’s funding is earmarked public subsidies, not voluntary donations.
• The foundation acts as an instrument of Zurich’s city and canton for public film promotion.
• The Federal Supreme Court noted that funds must be used for a public interest purpose, not freely disposed of.
• The funds’ classification as subsidies remains despite being passed through intermediaries.
• The foundation’s role is to distribute funds for a specific purpose in the film industry.

Source: primetax.ch

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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