In April, the draft bill of the Act on the Financing of Investments for the Future (Future Financing Act) had been published. We had reported on the amendments to the German Investment Code envisaged therein, which, at least with regard to supervisory law, are intended to create security for the handling of investments in connection with renewable energies (see our beinformed dated June 15, 2023). Last week, the German cabinet approved the draft with in so far only a few changes.

On July 14, 2023, the draft bill for an act to strengthen growth opportunities, investments and innovations as well as tax simplification and tax fairness (Growth Opportunities Act) was published. The draft for this omnibus bill, which is just under 280 pages long, also contains some important changes to the German Investment Tax Act for real estate funds, which we would like to highlight for you.

The German Federal Ministry of Finance has published a discussion draft on the amendment of the German real estate transfer tax. This amendment is in response to the reform of the German Act to Modernize the Law on Partnerships (Gesetz zur Modernisierung des Personengesellschaftsrechts (MoPeG)), which will fundamentally change the legal treatment of partnerships as of January 1, 2024, and thus will also have consequences under German tax law, specifically German real estate transfer tax. In particular, the discussion draft will address the taxation of share acquisitions in real estate (holding) companies, and specifically, it is about the so-called share deals. Whether the amendment of the real estate transfer tax proposed in the discussion draft properly addresses these issues, or if it misses the mark, remains to be seen.

In this beinformed, we wish to understand the draft to reform the German real estate transfer tax in general terms; we will have to shed light on the details later in an upcoming newsletter when the discussion draft is further developed in the legislative process.