Germany: Parliament passes tax bill revising minimum local trade tax rate, real estate transfer tax
The bill would generally become effective on the day after publication.
june 12, 2026
Germany’s parliament, the Bundestag and the Bundesrat, on June 11 and June 12, 2026, adopted the Ninth Act Amending the Tax Advisory Act and Other Tax Regulations. The newly adopted bill would increase the minimum local trade tax rate, reform the real estate transfer tax (RETT) rules to address double taxation, and allow banks and other payers to provide certain tax assistance services.
The bill must still be promulgated in the Federal Law Gazette and would generally become effective on the day after publication.
- Under the bill, the minimum municipal assessment rate for trade tax would be raised from 200% to 280% with effect from 2027, thereby increasing the minimum local trade tax rate from 7% to 9.8% (280% x 3.5%).
- Additionally, it would revise the Real Estate Transfer Tax Act (RETTA) to prevent double taxation in share deals by reversing the order of priority, meaning the signing of a transaction would be taxed primarily and the closing secondary. The bill would also extend RETT liability to the real estate-owning company, extend the domestic notification period from two weeks to one month, and permanently repeal the current time limit on certain RETT reliefs for partnerships.
- Finally, the bill would amend the Tax Advisory Act to expand the admissibility of providing business assistance in tax matters when it is a secondary service related to another activity. This change would authorize banks to apply for certificates of residence for taxpayers and file withholding tax refund or exemption applications. Furthermore, payers of cross-border payments would be authorized to apply for withholding tax exemptions or refunds under section 50c of the income tax act (ITA) when acting on behalf of their contractual partners.
Read a June 2026 report prepared by the KPMG member firm in Germany