Overview of the tax law decisions of the Swiss Federal Supreme Court published in the week of 24 - 30 July 2017.

  • Judgment of 11 July 2017 (2C_382/2016): Revocation of a tax exemption for state and municipal tax for the tax years 2004-2008 (Valais); "Tamoil SA" (the complainant) was granted a tax exemption by the Valais State Council (the respondent) on the basis of the reopening of a refinery (decision of 20 November 1996); by decision of 2 November 1996 (2C_382/2016) By decision of 2 June 1999, the State Council of the Canton of Valais decided on a further tax exemption or reduction for the tax years 2004 to 2008 (in this case 40% of municipal and state taxes), as long as the company's activity was permanent and the company's registered office remained in the canton [....], otherwise the tax-exempt years would be revoked; in March 2015, the appellant interrupted the refinery's activities; consequently, by decision of 15 April 2015, the Council of State revoked the tax exemptions granted retroactively to the date of approval (decision of 2 June 1999); an appeal against this decision was dismissed by the Cantonal Court of Valais; the Federal Supreme Court intervenes between Art. 23 para. 3 of the Swiss Penal Code and Art. 1 para. 3 RS/VS 671.1; the cantons are free in their formulation from Art. 23 para. 3 of the Swiss Penal Code (E. 2.2); arbitrary determination of the facts regarding the definitive closure of the refinery's business activities rejected (E. 5.2); Art. 238 para. 3 StG/VS (642.1) is unclear, as the article does not specify any period during which a tax exemption can be revoked (E. 6.5); relevant is therefore Article 53(2) StHG, according to which the right to initiate after-tax proceedings expires ten years after the end of the tax period (E. 6.6 and 6.6.1); the respondent is denied the right to revert to the tax exemption granted for the 2004 tax year; acceptance of the complaint on this point (E. 6.6.2); for the 2005 to 2008 tax years, the revocation period has not (yet) expired; breach of the principle of good faith (Article 9 Cst.) and breach of the guarantee of ownership (Article 26(1) Cst.) is dismissed if it occurs (E. 7.3); partial acceptance.
  • Judgment of 23 June 2017 (2C_892/2016), official publication planned: State and municipal tax for the assessment year 2013 (Neuchâtel) in the case of joint parental custody and alternating custody; the complainant deducted CHF 12,000.00 from his income under the heading of child maintenance (for the daughter, who lives with her mother) and also claimed a child deduction of CHF 4,500.00 (for the son living with the complainant); the Neuchâtel tax administration offset the child maintenance; question of the applicable tax rate (E. 6.3); in the present case, the application of the rate within the meaning of Art. 40a para. 3 StG/NE ("ménage commun avec des enfants") is not arbitrary in the sense of uniform taxation; the offset (of the "fictitious maintenance contribution") is admissible (E. 6.4); appeal dismissed.
  • Judgment of 14 July 2017 (2C_621/2017): Water consumption tax (Vaud) for the fiscal year 2017; in the cantonal appeal proceedings, the appellant's appeal was dismissed for lack of jurisdiction; an appeal against denial of justice based on this appeal was dismissed by the Federal Supreme Court.
  • Judgment of 14 July 2017 (2C_84/2017, 2C_130/2017): Back taxes and tax penalties; direct federal tax from December 2002 to December 2003 and from January 2005 to December 2005 (Lucerne); X. AG has as its object the provision of financial and real estate services as well as the management and sale of land and real estate; on 22 April 2008, the Tax Administration initiated against X. AG with respect to the tax period 2004 (due to double booked brokerage commissions, formation of non-operating provisions or non-valeurs); in addition, a tax and evasion proceeding with respect to the tax periods 2003 to 2005 has been opened against X. AG for the tax periods 2003 to 2005; X. AG partially prevailed in the cantonal appeal proceedings regarding the after-tax and evasion fine ruling. AG partially prevailed in that the Cantonal Court annulled the after-tax assessment for the tax period from December 2002 to December 2003 and exempted X. AG from the accusation of complete and utter fraud. AG from the charge of completed tax evasion; however, for the 2005 tax period, the cantonal court set the taxable net profit at CHF 656,055.00 and remanded the case to the tax administration for determination of the additional payment; on 27 January 2017 (FTA) and 1 February 2017 (X. AG), an appeal was filed against the decision of the cantonal court of last instance; the Federal Supreme Court first deals with the appeal of the FTA and does not accept its request to increase the taxable equity for the tax year 2003 to CHF 349,509.10 due to lack of legal interest and further confirms the decision of the court of first instance; with regard to the appeal of X. AG regarding the tax period 2005 (with respect to the taxable net income), the argument of an incorrect accounting due to the prohibition of novelties cannot be accepted and the Federal Supreme Court dismisses the appeal.
  • Judgment of 18 July 2017 (2C_647/2017): State and municipal tax as well as direct federal tax 2008 (Vaud); taxable income; appeal does not satisfy the principle of objection; the appeal is not upheld.

Decisions are listed chronologically by publication date.

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