Public Sector Taxes

The public sector with its regional and self-governing bodies (e.g. special-purpose associations, health insurance funds, universities) as well as private-law forms of enterprise (e.g. energy supply corporations) perform public functions. With its facilities and institutions, it serves the common good and, in particular, offers public services of general interest for the population.

The public sector is increasingly confronted with complex tax law considerations. At the European level, the concept of competition dominates, which exposes tax privileges for public sector activities to high demands for justification. At the national level, on the other hand, the specific public welfare purposes of these activities play a special role and justify tax exemptions. This does not present an easy situation in terms of tax compliance requirements.

In addition, public sector taxation cannot be viewed in isolation from trends in the public sector or from other areas of law. Tax consultancy in the public sector must therefore, among other things, provide answers to questions of digitalisation, whether on the digital taxation process, the digital organisation of authorities or broadband expansion and its subsidy issues. It must be aware of the cross-connections with procurement and state aid law, for example, in the case of a purchasing directive, tax instructions or claimed tax benefits.

We support business entities and public sector entities with comprehensive advice on tax matters, which, in addition to routine advice, also includes forward-looking, formative advice on the establishment, transformation or acquisition of business entities as well as tax organisation advice.

We advise on all relevant tax types and issues, including:

• Corporation tax, trade tax and withholding tax
• The Tax Code
• Value added tax and energy taxes
• Real estate tax and real estate transfer tax
• Reorganisation tax law
• Wage tax and artist social security

Consulting topics:

• Tax law analysis of previous activities with recommendations for action for the future and, if necessary, tax law corrections for the past
• Secure claiming of tax privileges in the area of income taxes and non-profit status (establishment and delimitation of the sovereign sphere, the non-material sphere or special-purpose enterprises)
• Tax-optimised collection of subsidies, for example, for infrastructure projects
• Input tax optimisation for public institutions
• Further development of the transverse tax system, determination of similar activities, assessment of new activities in light of digitalisation
• Successful design of public sector co-operations in the choice of legal form, the determination of content and their anchoring in the founding documents
• Organisational advice on improving tax processes, exploiting tax opportunities and reliably fulfilling tax obligations while at the same time averting risks for the public sector and its officers (tax compliance management system up to audit readiness in public institutions, including public business entities)
• Advice to governing bodies and committees, e.g. on major infrastructure projects whose tax assessment has a high public profile

Contact our experts. We will find the optimal tax structuring framework so that you can fulfil your responsibilities in the public sector in the best possible way.