A leading German tax law expert is raising serious constitutional concerns regarding the Social Democratic Party’s (SPD) proposed overhaul of inheritance tax laws, suggesting the plan could face legal challenges. Hanno Kube, a professor of tax law at Heidelberg University, argues that the SPD’s diminished emphasis on familial relationships when determining tax liabilities risks violating Germany’s Basic Law.
The core of Kube’s critique centers on Article 6 of the Grundgesetz, which guarantees the protection of family within the German constitution. He maintains that this protection extends to inheritance matters and that the SPD’s proposal, which significantly reduces differentiation in tax brackets based on the degree of kinship, creates a verfassungsrechtliches Problem – a constitutional problem.
The SPD’s plan aims to simplify the inheritance tax system by merging existing tax classes, currently tiered according to familial relationships, into a single framework. Furthermore, the proposed “life-exemption allowance” would lessen the distinction between close and more distant relatives. While intended to create a more equitable system, Kube believes this approach undermines the fundamental premise of Article 6.
“‘Family is family’ is a vast oversimplification” Kube stated in an interview with Handelsblatt, emphasizing that the Basic Law explicitly acknowledges distinctions within families, highlighting the protection afforded to marriage alongside the broader concept of family. This differentiation, he argues, is critical to the legal validity of inheritance tax policies.
The SPD argues its reforms address perceived inequities within the current system, but Kube’s assessment intensifies the political and legal scrutiny surrounding the proposals. The potential for a constitutional challenge could significantly delay or even derail the legislation, forcing the SPD to reconsider the scope and structure of the planned inheritance tax reforms and prompting a wider debate about the delicate balance between fiscal policy and constitutional protections for family. The government’s response will be closely watched by legal experts and opposition parties alike.