The fiscal jurisdiction
While the Federal Fiscal Court was established as early as 1950, the Code of Procedure of Fiscal Courts only came into force in 1966. This satisfied the constitutional mandate of Article 108 (6) of the Basic Law to regulate the fiscal jurisdiction uniformly by federal law.
The Code of Procedure of Fiscal Courts governs the procedures of the fiscal courts. Pursuant to § 1 of the Code of Procedure of Fiscal Courts, fiscal jurisdiction is exercised by independent special administrative courts that are separate from the administrative authorities. The financial legal process is open in the following cases:
- in public law disputes on tax matters, provided that the taxes are subject to federal legislation and are administered by federal or state tax authorities,
- in disputes under public law concerning the execution of administrative acts in other matters, insofar as the administrative acts are to be executed by federal financial authorities or state financial authorities in accordance with the provisions of the Tax Code,
- in disputes under public law and labour law on matters arising from the Tax Consultancy Act,
- in other public law disputes, insofar as federal or state law opens up the fiscal legal process for these.
Any public law disputes that are not assigned to the fiscal courts are subject to the jurisdiction of the (general) administrative courts. They are therefore responsible in particular for municipal taxes (e.g. dog tax, amusement tax, trade tax), but also partly for church taxes. In contrast to the jurisdiction of the general administrative courts, the fiscal courts have jurisdiction if citizens' rights are infringed by measures taken by the fiscal authorities (in particular tax offices, main customs offices) in tax or customs/excise duty matters.
In contrast to the other jurisdictions in Germany, the fiscal jurisdiction has only a two-tier structure. While the Länder have administrative courts for general administrative jurisdiction and, as the second instance, higher administrative courts (Verwaltungsgerichtshöfe), as well as social courts and, as the second instance, state social courts, the fiscal courts in the Länder have only a single-tier structure. The fiscal courts have the status of a higher regional court (§ 2 Code of Procedure of Fiscal Courts). They are thus on the same footing as the regional courts of second instance.
Citizens can regularly lodge appeals against acts of the tax authorities. The tax authorities (tax offices, main customs offices) which issued the contested administrative act decide on this appeal. In principle, an action can only be brought before the fiscal court once the appeal proceedings have been concluded. Under certain conditions, the decision of the fiscal courts can be appealed against before the Federal Fiscal Court.
The judges of the fiscal courts are (like all judges) independent under the German Judiciary Act to ensure their impartiality. At the same time, the separation of administration and court means that the fiscal jurisdiction is limited to legal control. Insofar as the tax authority may make so-called discretionary decisions, the fiscal court may in principle only examine whether the challenged discretionary decision is based on an excess or misuse of discretion. For example, it is at the discretion of the tax authorities to decide whether taxes should be waived on grounds of equity. In these cases, the courts of the fiscal jurisdiction only examine the legality of the official action in the individual case, but not the expediency of the official action. The fiscal courts are not authorised to substitute their own discretion for that of the tax authorities.
There are 18 fiscal courts in the Federal Republic of Germany with a current total of around 600 professional judges:
- Fiscal Court Baden-Württemberg (based in Stuttgart, with an external senate in Freiburg),
- Fiscal Court of the Länder Berlin-Brandenburg (based in Cottbus),
- Fiscal Court Bremen,
- Fiscal Court Düsseldorf,
- Fiscal Court Hamburg,
- Fiscal Court Hesse (in Kassel),
- Fiscal Court Cologne,
- Fiscal Court Mecklenburg-Western Pomerania (in Greifswald),
- Fiscal Court Munich (with external senates in Augsburg),
- Fiscal Court Münster,
- Fiscal Court Lower Saxony (in Hanover),
- Fiscal Court Nuremberg,
- Fiscal Court Rhineland-Palatinate (in Neustadt an der Weinstrasse),
- Fiscal Court of the Saarland (in Saarbrücken),
- Fiscal Court of the State of Saxony-Anhalt (in Dessau),
- Fiscal Court Saxony (in Leipzig),
- Fiscal Court Schleswig-Holstein (in Kiel),
- Fiscal Court Thuringia (in Gotha).
The fiscal courts regularly make decisions through their senates, which are composed of three professional and two honorary judges. The honorary judges do not participate in rulings outside the oral hearing and in court orders. Cases in which the points of law are not of fundamental importance and which do not present any particular difficulties of a factual or legal nature may be transferred to a single judge for decision (§ 6 of the Code of Procedure of Fiscal Courts). With the agreement of the parties to the proceedings, such a decision may also be taken in other cases (§ 79a(3) and (4) of the Code of Procedure of Fiscal Courts).