New eu directive keeps kissinger chamber busy for years

New eu directive keeps kissinger chamber busy for years

A new EU directive has kept the finance committee of the city council busy for some time in its recent meeting. From 1. January 2017: a new sales tax law comes into force. "This means for the municipalities an extension of the sales tax obligation and a substantial administrative overhead", explained city chamberlain gerhard schneider.

The new regulation is essentially aimed at areas in which non-taxation of municipalities leads to distortions of competition compared to private competitors. Until now, municipalities were obliged to pay sales tax on commercial operations, such as swimming pools and leased restaurants in the case of bad kissingen, as well as on agricultural and forestry operations.

"The consequences for the municipalities can be considerable", said schneider. However, they are not yet to be estimated. In the opinion of both the bavarian municipal association and the municipal auditing association, a lengthy and extensive review is needed to determine which activities are subject to sales tax under the new legislation.

Because the new regulations are very complex and there is considerable testing and conversion work to be done, the chamber says there is a transitional arrangement. This allows the old sales tax law to be applied for a further four years. Municipalities that make use of the transitional regulation must notify the tax office by the end of the year. The transitional arrangements can be revoked if the change is found to be more favorable to a municipality.

The finance committee unanimously instructed the administration to make use of the transitional regulation and to inform the tax office accordingly.

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