The Federal Court of Justice caused a sensation on Wednesday with the determination of a matter of course: taxes that have not been paid cannot be reimbursed by the state.
The fact that it took ten years for Germany's highest criminal judge to proclaim this matter of course explains why a rather brazen idea turned into a tax scandal that some call the greatest tax robbery of all time.
A gold digger mentality
Because what today is rightly and “without a doubt”, as the BGH emphasizes, is branded as tax evasion, has been considered a bombproof investment in the financial scene for years. The risk of being discovered was zero, as it was believed to have found a tax loophole that one could even fearlessly advertise in seminars. Renowned business lawyers prepared reports for this purpose, for which an entire industry is ashamed today - apart from those who already knew better back then.
This may have something to do with a gold digger mentality that is hardly imaginable today, in which excess testosterone obscured the view of good morals. The state has also let itself be carried away: Germany shouldn't miss the hype about stocks. It was not until the financial crisis in 2008 that the industry suffered a severe image problem, but it should still be a few years before the first cum-ex gamblers hit the collar.
The mood has changed dramatically since then. There is now broad consensus among the general public that the tax models described were not only immoral, but also criminal.
But that does not mean that the actors also see it ruefully. The reaction of the private bank MMWarburg & CO clearly shows how the defense strategy will also be in the future: A few "big wire pullers" have turned the cum-ex carousel faster and faster; the rest just sat there in a daze. As groundbreaking as the BGH ruling is, it ultimately fell in a procedure that was comparatively easy to deal with for the public prosecutor and the courts. The really tough chunks are yet to come.