Germany: Challenge to legality of the German Minimum Tax Act dismissed (Cologne Fiscal Court decision)
Court rejected taxpayer’s arguments that underlying EU Minimum Tax Directive is invalid.
The Cologne Fiscal Court on June 24, 2026, dismissed a taxpayer challenge to the legality of the German Minimum Tax Act and the requirement to file global anti-base erosion (GloBE) information returns (GIRs) and local minimum top-up tax returns.
The taxpayer argued that the underlying EU Minimum Tax Directive (2022/2523) is invalid on several grounds. However, the court rejected those arguments, finding that the directive was validly adopted under Article 115 of the Treaty on the Functioning of the EU (TFEU) because the harmonization of a minimum level of taxation is directly relevant to the functioning of the internal market. In addition, the directive is binding on member states until declared invalid by the Court of Justice of the European Union (CJEU), and national courts are not entitled to disregard the validity of EU legislation themselves under the CJEU's Foto-Frost doctrine.
In addition, the court held that challenging the legality of the German Minimum Tax Act in advance (by way of a preventive declaratory action) violated the subsidiarity principle under the German General Fiscal Code. The court noted that the taxpayer could instead challenge the validity of the German Minimum Tax Act through an appeal against a future local minimum (self-assessment) return treated as a tax assessment (even in the case of a "nil return").
The taxpayer has appealed the decision to the Federal Fiscal Court (case I R 12/26).
Read a September 2026 report prepared by KPMG’s EU Tax Centre