German tax authorities: Who is responsible for what?

The German tax system is complex and comprises various authorities that are responsible for different types of tax and tax-related tasks. Here is an overview of the most important tax authorities and their tasks:

1. the Federal Ministry of Finance (BMF)

• The BMF is the highest tax authority in Germany.
• It defines the Principles of tax policy and is for the Legislation in tax law responsible.
• It coordinates the work of the Tax offices, customs authorities and federal authorities in the tax area.

Main tasks:
-Development of Tax laws
-Coordination with the EU and international tax authorities
-monitoring of the Federal tax revenues
-Control of the Federal Financial Administration

2. tax offices (state level) - responsible for tax collection

• The Tax offices are the most important points of contact for citizens and companies in tax matters.
• They belong to the State financial administration (i.e. the federal states) and not the federal government.

What are tax offices responsible for?
– Income tax & corporation tax (for private individuals and companies)
– GBusiness tax (but only for determination, it is levied by the municipalities)
- Value added tax & input tax refunds
- Wage tax (Employers must pay income tax to the tax office)
– Inheritance & gift tax
-Processing of Tax returns & tax assessments
- Examination & enforcement of the Tax regulations

Special tax offices:

• There are special tax offices for Large companies, foreign matters or tax investigations.
• Examples:
  • Tax office for large companies → advises large companies with complex tax cases.
  • Tax office for corporations → responsible for associations, foundations and non-profit organizations.

3 Federal Central Tax Office (BZSt) - Responsible for national & international tax issues

• The BZSt is a federal authority that performs tax tasks of supra-regional importance.

What is the BZSt responsible for?
-Assignment of the tax identification number (tax ID)
-Assignment of the sales tax identification number (VAT ID)
–Refund of capital gains tax for foreign companies
–International tax treaties & data exchange with other countries
–Monitoring of tax avoidance & abuse

4. customs administration - responsible for excise duties & international tax control

• The Customs (under the Federal Finance Directorate) performs many tax-related tasks, especially in the area of Import, export and excise duties.

What is customs responsible for?
-Import sales tax & customs duties (for imports of goods from non-EU countries)
–Excise dutiese.g:

• Energy tax (on gasoline, diesel, heating oil)
• Tobacco tax
• Alcohol & spirits tax
  –Combating tax evasion & undeclared work (e.g. by the Finanzkontrolle Schwarzarbeit - FKS)

5. local tax authorities - responsible for local taxes

• The cities and municipalities manage some taxes themselvesabove all:
  –Trade tax (determined by the tax office, but levied by the municipality)
  –Property tax (for real estate owners)
  –Entertainment tax (for slot machines, clubs etc.)
• Companies with permanent establishments often also have to register with the Municipal administration log in.

6. tax investigation & tax audit - control and enforcement

• The Tax investigation is a specialized department within the financial administration.
• Target: Combating tax evasion, tax fraud & undeclared work.
• The Company audit checks companies for tax correctness.

What is the tax investigation responsible for?
-Investigations at Suspicion of tax evasion
-Searches & seizures for tax offenses
- Cooperation with the Public prosecutor's office & customs authorities

Anyone who does not pay taxes correctly can be severe penalties or imprisonment calculate.

Summary: Who is responsible for which tax?

Who takes care of which tax?

–Tax offices are the most important points of contact for companies and private individuals.
–The BZSt handles supra-regional tax matters, such as tax IDs and international tax issues.
–Customs is responsible for excise duties, import VAT and illegal employment controls.
–Municipalities administer trade tax and property tax.
–The tax investigation combats tax evasion.