The current tax law in Germany allows for a full inheritance tax exemption for family run businesses if ownership and management are passed to the decedent’s heirs. A current challenge to the constitutionality of the exemption is being heard and many tax lawyers are predicting the ruling to hold the exemption unconstitutional. A survey conducted early this year found that layoffs are expected for half of family-owned businesses in Germany, which make up 92% of all German companies, if the exemption is ordered to end.
See Andrea Thomas, Tax Battle in Germany Shakes Family Dynasties, The Wall Street Journal, Dec. 8, 2014.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
