VAT Assessment Basis Reduction in Criminal Confiscation of Proceeds of Crime

• The BFH ruled that the VAT assessment basis in the case of criminal confiscation of proceeds of crime should be reduced to the amount reduced by the confiscated amounts.
• The BFH referred the dispute back to the tax court for further clarification.
• A reduction of the assessment basis is required under EU and constitutional law to avoid violating the principle of equal treatment.
• The plaintiff had received monetary benefits for the commissioning of a specific engineering firm.
• The amounts received were the “consideration” for the taxable supply of the claimant.
• The taxable amount was to be reduced by the amount successfully collected by way of an interpretation of §§ 10 para. 1 sentence 1, 17 para. 1 sentence 1 UStG in conformity with EU law.
• The tax court would only have to examine whether the payments made were actually for amounts within the meaning of Section 73 StGB.

Source: hub.kpmg.de

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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