Overview of the tax law decisions of the Swiss Federal Supreme Court published in the weeks from 26 March - 8 April 2018.

  • Judgment of 8 March 2018 (2C_312/2017): Value Added Tax (VAT); services used by the State in the performance of its public duties may also be subject to VAT, provided there is an exchange of services and no subsidy is involved (BGE 141 II 182 recital 3.5 p. 189) (Art. 18 para. 2 lit. a VAT Act). If the State contributes to the promotion and support of a certain behaviour that is in the public interest, it constitutes a subsidy. If, on the other hand, the State purchases a specific and individualised service in order to perform a task for which it is responsible, there is an exchange of services subject to VAT. The services provided by a forester of a group of municipalities are subject to VAT in the present case (E. 4.4). The appellant's appeal is dismissed.
  • Judgment of 8 March 2018 (2C_784/2017): Cantonal and communal taxes 2010 (Geneva); the complainant, a self-employed person, had booked a claim of CHF 8,000,000 against his former business partner in 2006, which had been determined on the basis of a settlement, and had written off CHF 4,000,000. He had written off a further CHF 1,000,000 in the 2007 tax period. When he wanted to claim the corresponding loss carry-forwards in the 2010 tax period, the tax authorities refused to do so, arguing on the one hand that the claim should have been booked earlier than 2006 due to the principle of accrual, and on the other hand that it was no longer recoverable in 2006 anyway - the business partner had been permanently insolvent - which is why the claim could no longer be booked. The Federal Supreme Court confirmed the decision of the lower court and dismissed the complainant's appeal.
  • Judgment of 22 February 2018 (2C_357/2017): Real property gains tax (Zurich); unpaid costs of third parties cannot be offset against the real property gains tax; only expenses that have actually been paid can be offset. "If, in a specific case, it transpires that expenses were invoiced but not paid, or if the taxpayer fails to provide proof of payment when requested to do so by the tax authority, the result is that the expenses in question have not been incurred. In the opinion of the Federal Supreme Court, the pre-institutional assessment does not violate the congruence principle. Dismisses the applicants' appeal.
  • Judgment of 16 March 2018 (2C_580/2017): Determination of tax domicile from the 2016 tax period (Freiburg/Ticino); determination of tax domicile in intercantonal tax law. The complainant is (apparently) from Ticino and (apparently) a full professor at the University of Freiburg. He denies having his main tax domicile in Freiburg. A taxpayer over 30 years of age who is in employment is presumed to have his main tax domicile at the place where he stays during the week and from which he goes to work. This presumption can be rebutted if the taxpayer returns regularly, at least once a week, to the place of residence of his family members and can prove that he has particularly close links and other personal and social relationships with them (E. 4.2). In the present case, the complainant was not able to provide this rebuttal evidence and his complaint was therefore rejected.
  • Judgment of 22 March 2018 (2C_913/2017): Tourist tax 2016 (Valais); the wife had paid the tourist tax for the apartment she owned in the canton of Valais (CHF 900) and demanded half (CHF 450) of the amount from her husband. In the meantime, the spouses are divorced. The man lodged an appeal against the order concerning the visitor's tax (and the visitor's tax regulations themselves). The question in dispute was whether he had an interest worthy of protection, which the Federal Supreme Court affirmed in the last instance on the basis of the woman's potential recourse claim (CHF 450). Approval of the appellant's appeal and rejection of the appeal to the lower court.
  • Judgment of 19 March 2018 (2C_797/2017): Real estate gains tax (Valais); the taxpayer was accused, inter alia, of false notarisation, as he had part of the sale price of a property paid to him "black" (notarised price: CHF 3,200,000; "black payment": CHF 1,800,000). On the basis of these facts, criminal proceedings were opened, inter alia, for fraudulent certification and tax fraud. In this context, the public prosecutor's office requested files of the taxpayer from the tax authority and communicated the suspicion of tax fraud to the latter. Despite this event, the Valais tax authority had assured the taxpayer that the conditions for a voluntary declaration without penalty had been met. Under these circumstances, the question of the taxpayer's legitimate expectations arose. According to the Federal Supreme Court, there is no protection of legitimate expectations, as the voluntary disclosure does not constitute a measure that is "harmful" to the taxpayer and to which he cannot return, since the criminal proceedings were underway anyway and thus the tax authority would have been made aware of the tax fraud sooner or later. (E. 4.4).
  • Judgment of 26 March 2018 (2C_101/2018): Direct Federal Tax and State and Municipal Taxes 2010 (Geneva); assessment of spouses according to dutiful discretion. The spouses missed the deadline to object to these predispositions and claim that they were unable to meet the deadline for health reasons. The spouses accuse the last cantonal instance of having failed to use the evidence submitted before the first cantonal instance, thereby violating the right to be heard (Article 29(2) BV). Approval of the appellants' appeal and rejection of the application to the lower court.

Non-occurrence decisions / inadmissible complaints:

  • Judgment of 6 March 2018 (2C_212/2018): Direct federal tax and state and local taxes 2016 (Thurgau); advance payment of costs; request for a stay of proceedings; the taxpayer's complaint is not upheld.

Decisions are listed chronologically by publication date.

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