With regard to the cornerstones of a company taxation reform which were fixed by the German government on Wednesday, Mr. Mario Ohoven, who is chairman of the Confederation of German small and medium-sized entities (BVMW), declared: “The German government has realized at last that tax cuts mean smaller revenues at first, but will lead to a fresh impetus for investment and growth in the medium term thereby even increasing state revenues.
What is important , however, is the reform leading to real noticeable financial easings for companies, continued Mr Ohoven. Therefore the taxation of real assets propagated by the Federal Minister of Finance must clearly be rejected given that companies with little equity and high interest obligations would have to pay particularly high taxes. Not only would this represent an obstacle to investment by small and medium-sized entities (SMEs), but also a threat to the very existence of many SMEs.
Relating to the finance minister’s promise that all companies would benefit from the reform Mr Ohoven said: “SMEs will keep watching the reform process in a critical and constructive manner. It has to be made sure that partnerships, which are the typical legal form of SMEs, are not worse off than public limited companies.