As from 2013: Real Estate Transfer tax on (in)direct economic accumulation of shares? Draft bill aiming at combating so-called RETT blocker structures -
So far, all shares in a company holding German real estate can generally be transferred to an acquirer without triggering German real estate transfer tax (“RETT”) provided certain additional entities with minority shareholders are included in the acquisition structures (“RETT blocker”). Thereby, an acquirer can economically hold (almost all of) the shares in the real estate holding company. In particular the latter option shall be abolished.
The German Federal Finance Ministry – prompted by the German Bundesrat – has presented a proposal combating such RETT blocker structures. The proposed bill suggests an implementation of a new section 1 paragraph 3a Real Estate Transfer Tax Act pursuant to which the direct or indirect economic accumulation of 95% or more of the shares in a company shall trigger RETT as from 1 January 2013. The proposal is worded as follows (convenience translation)...
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