Overview of tax law decisions of the Swiss Federal Supreme Court published between May 1 - 7, 2023:

  • Judgment of 12 April 2023 (9C_674/2022): State and municipal taxes 2015 - 2018 (Valais); The association A. has limited tax liability in the canton of Valais. At issue is whether the 2015 - 2018 assessment decisions of the Valais tax administration should have been subsequently amended on appeal, since the Geneva tax administration granted a tax exemption to Association A. on January 14, 2020. The FSC concluded that Association A. did not assert a tax exemption ground in the assessment procedure for the years 2015 - 2017, nor did it address the Valais tax administration in advance. It would have been the responsibility of Association A. to claim a tax exemption in the ordinary procedure. With respect to the 2018 tax period, the Valais tax administration informed Association A. that it was up to the Geneva tax administration to verify whether Association A. met the conditions for a tax exemption. Thus, the tax administration clearly expressed not to grant a full tax exemption to Association A. Dismissal of the appeal of the association A.
  • Judgment of 12 April 2023 (9C_689/2022): Withholding tax; back taxes and fines due to tax evasion 2008-2013 (Geneva); The proceedings are already in the second round of proceedings before the Federal Supreme Court (cf. regarding the first round of proceedings the judgment of 27 April 2021 (2C_60/2020 ) and our article of 16 May 2021). In the present case, the taxpayer A. AG is accused of not annualizing the income of the physicians employed by it and subject to withholding tax in order to determine the applicable tax rate and of not accounting for the withholding tax on cash payments from patients. The BGer concludes that, with regard to the cash payments, an after-tax reason as well as tax evasion must be affirmed. With regard to the allegation of lack of annualization, however, there is no legal basis in the old withholding tax law. The taxpayer's appeal is therefore partially upheld. The appealed judgment is set aside and the matter is referred back to the tax administration to recalculate the back taxes and fines. For this purpose, it must recalculate the withholding tax amounts to be levied on the total gross income earned by each doctor in each tax period in dispute, without annualizing the income for purposes of determining the tax rate. The withholding tax amounts to be recalculated shall be equal to the positive difference between the tax amounts so recalculated and the amounts collected by the taxpayer. Fines for evasion of withholding taxes are subsequently recalculated to equal one-third of the amounts evaded. Once the back-tax amounts have been determined, the tax administration must also check to what extent the withholding tax amounts have already been claimed from the physicians concerned. If this is the case and if the recovery decisions issued to the physicians are already legally binding, it must deduct the corresponding amounts from the amounts claimed in arrears by the taxpayer in order to avoid a double charge. If, on the other hand, the decisions served on the doctors are not yet final, the cantonal administration may claim the amounts in question exclusively from the taxpayer in order to avoid a double burden. This solution is justified by the fact that only the taxpayer is legally responsible for the payment of the withholding tax.
  • Judgment of April 19, 2023 (9C_634/2022): Official evaluation (Graubünden); the lower court has determined the legally relevant facts in several respects obviously incorrectly. In addition, the contested judgment has numerous formal defects. The judgment of the Administrative Court of the Grisons is set aside and the matter is referred back to the Administrative Court of the Grisons for a new decision in accordance with the considerations. Approval of the appeal of the taxpayer.
  • Judgment of March 24, 2023 (9C_656/2022): State and municipal taxes 2011, 2013 and 2014 (Aargau): In the present case, there are no indications on the basis of which the contested discretionary assessments would exceptionally have to be judged as null and void for substantive reasons. Likewise, no serious procedural errors are apparent, which is why the existence of the discretionary assessments for the state and municipal taxes 2011, 2013 and 2014 is not to be questioned. With this result, the tax returns submitted by the complainants in the administrative court proceedings can also no longer be taken into account. It would have been open to them to prove that they were incorrect or to make up for the omitted acts of cooperation in the ordinary appeal proceedings and, in particular, within the objection period. Dismissal of the taxpayers' appeal.
  • Judgment of March 31, 2023 (2D_53/2020, 2D_25/2021) - intended for publication: Alignment of contributions from the proceeds of the visitor's tax (Valais); The A. AG considered the equal treatment requirement of Art. 8 para. 1 BV to be violated, since it, in contrast to its direct competitor B. AG was not paid any contributions to the fixed infrastructure costs for the operation of its thermal spa. Irrespective of the fact that B. AG partly performs public tasks in the tourism sector and that the municipalities hold shares in it, B. AG performs a private-sector task with regard to the operation of its thermal spa; the payment of the entire spa tax revenue to B. AG therefore violates the principle of equal treatment. Appeal of A. AG upheld and referred back to the lower court to determine the amount of the contributions to be paid to A. AG. AG for the determination of the amount of the contributions to be paid to A. AG.
  • Judgment of April 20, 2023 (9C_613/2022): Direct Federal Tax and State and Municipal Taxes 2017 (Zurich); A pension solution that does not intend collectivity and solidarity from the outset does not serve the purpose of occupational pension provision, but rather (individual) self-provision. Virtual collectivity can only be spoken of if it is also legally proven that realistically at some point in the future at least one other person can fulfill the conditions to be included in the "1e pension plan". The regulations are a necessary but not sufficient condition for this. In the present case, the legally sufficient proof of virtual collectivity could not be provided. Consequently, the contributions made by the taxpayer to the foundation in the amount of CHF 128,404 are not to be admitted as business-related expenses. Dismissal of the taxpayer's appeal.

Decisions are listed chronologically by publication date.