© Institute for Digitalization in Tax Law
After being unexpectedly removed from the agenda of the Cabinet meeting on August 16, 2023, the government coalition published a revised draft of the “Growth Opportunities, Investment, and Innovation Strengthening Act,” abbreviated as the Wachstumschancengesetz, on August 30, 2023.
The government draft (RegE) primarily consists of changes in income tax law, including the suspension of minimum profit taxation (from 2024 to 2027) and the (re)introduction of a declining depreciation option for residential buildings starting from October 1, 2023. Additionally, Article 39 in the RegE includes a clarifying amendment to the Real Estate Transfer Tax Act due to the MoPeG.
Compared to the preliminary draft (RefE), the government draft (RegE) deviates only slightly in terms of digitalization issues. The IDSt has already provided extensive comments on the RefE. Our statement primarily focuses on the planned changes to the Value Added Tax Act in the context of introducing electronic invoicing for B2B transactions, as well as other topics with a direct digitalization connection.
In the area of the proposed mandatory electronic invoicing, some of the criticisms raised in the preliminary draft (RefE) have been addressed in the government draft (RegE). Firstly, an authorization in favor of the Federal Ministry of Finance (BMF) has been introduced to issue a legal ordinance aimed at simplifying the taxation process by providing further details on the structured electronic format of electronic invoices (§ 14 Abs. 6 UStG-E). Secondly, an additional transitional provision has been established, granting businesses with a total turnover of up to €800,000 a grace period for transitioning to electronic invoicing until the end of 2026 (§ 27 Abs. 39 S. 1 Nr. 2 UStG-E).
However, it should be noted that the RegE still maintains the plan to abolish the Electronic Data Interchange (EDI) procedure from the year 2027. This plan had previously been criticized by the IDSt in its comments on the RefE, as it would render an established procedure used for decades unusable and result in significant investments made by companies going to waste.
The complete IDSt statement on the preliminary draft (RefE) is available for download below.
