Tuesday, February 4, 2014

Before tax, after tax - death is still certain, taxes not so much

From our People-are-People series.

After old time German soccer icon and manager of Bayern Munich, Mr. Hoeness, had some bad press last year when untaxed money came to light, we made fun of the story.

In recent months, more public figures were outed as squirrels with money on which they did not pay tax. Most, if not all, had the cash stashed in Switzerland. The Germans had negotiated a tax deal with the Swiss where the latter would withhold a lump sum of 25% taxes on gains in German-held accounts and send the money to the German government.

The deal fell through.

When one or more enterprising Swiss IT guys sold a CD containing details of German held accounts to German state officials, the number of Germans who went to their tax office and reported undeclared money in return for not being prosecuted rose.

Then, just days ago, another icon of Germany, feminist Alice Schwarzer, was outed as one of these people.

Her apology, though, ignited a firestorm.  She called her account a mistake caused by fear in the 1980s that she might have to leave the country. There was so much hate back then, she said, now I paid the taxes and a fine, and I am upset with this breach of privacy.

One of her mantras was "the private is political". Her detractors, of course, pointed out that her public role does make this private matter political.

Anyhow, right on the heels of this, the Berlin city culture department chief was outed, too. Matters in his case were made worse by the fact that his boss, the powerful mayor of Berlin, knew since the deal was struck in 2012, yet kept his friend in office.

The list of recent prominent figures in Germany with tax issues includes such moral figureheads as the former publisher of Die Zeit and others.

Never much liked by the public, the steady flow of revelations has initiated a debate about whether to change the old policy of "come forward and we will not prosecute".

Personally, there is not much to say. All of this is so far remote from the small time earner writing the post.  As a friend said, if I had half a million dollars in the bank, I'd be happy to pay taxes on the earnings. Our resident cynic replied: yes, just goes to show that you will never have that much money to your name.

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