Overview of the tax law decisions of the Swiss Federal Administrative Court published in the week of 25 September - 1 October 2017.

  • Judgment of 6 September 2017 (B-4992/2015): Tax relief on direct federal tax (second period); by decision of 7 October 2007, the State Council of Canton X. granted the complainant a tax relief for a period of 5 years from 1 January 2008, inter alia, in the amount of 70 % on the cantonal tax on profits and capital; subsequently, at the request of the State Council of Canton X., the Federal Department of Economics, Education and Research (WBF, respondent) exempted the complainant by decision of 21 October 2007, and the State Council of Canton X. granted the complainant a tax relief for a period of 5 years from 1 January 2008, inter alia, in the amount of 70 % on the cantonal tax on profits and capital. In accordance with this decree, the tax relief is granted in two stages of 5 years each and, moreover, only if 35 new jobs are created; for the second period in dispute, the Council of State submitted the (extension) application for the tax relief to the WBF; in its decree of 16 June 2015, the WBF determined that the conditions of the tax relief granted in its decree of 21 December 2007 were not met. The Federal Administrative Court considers that the tax relief (direct federal tax) granted to the complainant on 31 December 2007 in favour of the complainant has not been fulfilled for the second period, since only one new job had been created as of 31 December 2012; the Federal Administrative Court considers that the content and scope of an order primarily result from the dispositive; if the dispositive is unclear, incomplete, ambiguous or contradictory, the uncertainty must be removed by interpretation (E. 2.4); the interpretation of an order is based on its factual and legal significance; in the main reasoning, the Federal Administrative Court states that the order of 21 December 2007, which is the subject of the dispute, does not, in comparison to the (broadly formulated) law, explicitly limit the scope to jobs in the enterprise itself, which is not the fault of the complainant (E. 2.5.4); approval of the appeal for the purpose of further examination of the facts.
  • Judgment of 31 August 2017 (A-358/2017): VAT 2011 to 2013 (training services / staff hire); the provision of full-time instructors to a foundation does not constitute in the present case a tax-exempt instructor activity within the meaning of Article 21(2)(11) VAT Act, but taxable staff hire, since the instructors are integrated into the operational organisation of the foundation and the powers of instruction have been transferred to the foundation; the complainant does not run a school and cannot rely on Article 21(2)(12) VAT Act; dismissal of the complaint.
  • Judgment of 17 August 2017 (A-7749/2016): Decision appealed to the Federal Supreme Court; VAT (option); the VAT for the rental of a sports facility is not openly shown if the statement of the applicable tax rate or the tax amount is missing in the rental agreement; the wording "plus VAT" is not sufficient for openly showing the VAT; dismissal of the appeal.
  • Judgment of 27 April 2015 (A-3935/2014), BVGE 2015/24: Generalised System of Preferences in favour of developing countries (so-called Least Developed Countries); erroneous omission of preferential customs clearance; remission of customs duties; Switzerland grants tariff preferences on request when importing originating products from developing countries under the Generalised System of Preferences, provided proof of origin is presented upon import; under the Customs Act 2005, the erroneous omission of a declaration for preferential customs clearance is not an exceptional reason within the meaning of Art. 86, Subsection 1, Letter d, ZG more, insofar as a possibility of correction existed in the assessment procedure pursuant to Art. 34 ZG.

Decisions are listed chronologically by publication date.

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