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MIL OSI Translation. Region: Germany / Deutschland –

Source: CDU CSU

Madam President! Dear Colleagues! Ladies and gentlemen! Prime time in the Bundestag, and at prime time we are dealing with a rather dry topic with moderate entertainment value – you noticed it -: the modernization of insurance taxes.

(Laughter from members of the CDU / CSU)

Almost all of us have taken out one or more private insurance policies that insure life and limb or things that are dear to us. In principle, the premiums for these insurance policies are subject to taxes in a comparable amount to sales tax. For social or economic considerations, however, the legislature can make exceptions to the basic taxation or the level of the tax rate. At the beginning of this year, for example, we gave so-called drought insurance – i.e. protection against drought-related crop failures – tax privileged and thus relieved those farmers who wanted to insure themselves against corresponding crop failures.

(Applause from the CDU / CSU)

Insurance policies that give rise to claims in the event of death, experience or old age, such as life and pension insurance, have always been tax-exempt.

Dear colleagues, it was and is the will of the legislature that the premiums for traditional old-age provision not be subject to taxation. In addition, insurance premiums for private health, occupational disability and supplementary long-term care insurance – our colleague Arndt-Brauer referred to this – are and are generally tax-exempt. It will stay that way.

(Sebastian Brehm [CDU / CSU]: That’s how it is!)

The crucial point for an insurance tax exemption, however, is that the insurance benefit goes to the policyholder himself, his relatives or the insured risk person; actually a matter of course, one might think. In reality, however, there are case constellations – the colleague pointed out – in which neither the policyholder, a relative, nor the risk person can benefit from an insurance benefit, but the insurance premiums are still tax-free. This is, for example, about this sports disability insurance with market value coverage, which professional football clubs conclude and where the insurance benefit does not go to the player but to the club. If a tax is not only to have a targeted steering effect, but is also to be designed to be fair, then ongoing review by the legislature is required. It is precisely at this point that the law to be discussed comes into play. It creates clarity, security and fair taxation.

Dear Colleagues, During the intensive parliamentary deliberations and during the exchange with the associations involved, the individual reform points were actually discussed in some controversial and very intensive ways. Both companies and consumers feared that the review, documentation and processing of a possible tax liability would lead to a disproportionate amount of effort and ultimately to higher costs. As we as a coalition do not make laws for ourselves but for the citizens of our country, we took the arguments put forward very seriously and discussed them intensively with the ministry.

Even if we would like a realistic estimate of the legal consequences in the future, I can say that almost all fears have been dispelled. With the explanatory letter from the Federal Ministry of Finance, we provide the tax authorities with a good guide that clearly illustrates and describes possible tax liability scenarios. We have also made changes to the draft with regard to the possible controllability of non-favored contract constellations. Ms. Arndt-Brauer pointed out: These only apply to new contracts from January 1, 2022. We have thus ensured a longer transition period for insurers. This regulation also fits better into the administrative processes of the company and thus also reduces the conversion effort.

The fear of many insurers that they would have to take all existing contracts – after all, that is 80 million pieces – in hand and check their tax liability has been dispelled. It is clear that existing old contracts are not affected by the regulations.

Initially, there were irritations with the terms of the close relatives named in the law and the person at risk. However, through corresponding references to Section 15 of the Tax Code and Section 7 of the Nursing Leave Act, a clarification could also be achieved here. In the future, insurers will be able to identify whether the contract is taxable or not by asking clear questions when the application is submitted. A continuous review of the contract data is therefore not necessary. Even after signing the contract, the policyholder does not incur any significant additional expenses. A tax liability arises for the insurer only when he becomes aware of significant changes in the reference person at the policyholder.

The concerns of the municipalities raised in the hearing – this has been referred to – which had concerns about the tax exemption of the aid transfer insurance could also be refuted in the parliamentary procedure; because the municipalities are generally obliged to grant their civil servants benefits in the event of illness. In fulfilling this duty of care, they are also exempt from insurance tax. So no problem either!

Ultimately, the concerns of the German shipowners, who feared a co-assured problem in the management of foreign ships, were also allayed in our opinion by an explanatory letter from the BMF.

I would like to take this opportunity to expressly thank the BMF for the fact that the questions and objections were answered and dealt with satisfactorily during the public hearing and in the subsequent discussions with the rapporteurs. The aforementioned explanatory letter from the BMF is published in parallel and thus also creates legal certainty.

All in all, dear colleagues, a good deal of the coalition’s financial policy. I would like to express my thanks again for the constructive discussion with all colleagues from all parties and the support provided by the ministry. Together we will present a good law that will lead to a necessary and appropriate adjustment of tax law.

Thank you for your attention and I recommend that you all approve the present bill.

Thank you very much.

(Applause from the CDU / CSU and from Lothar Binding [Heidelberg] [SPD])


EDITOR’S NOTE: This article is a translation. Apologies should the grammar and / or sentence structure not be perfect.

MIL Translation OSI